Economic crisis is not yet over, budget may deepen it

Empty rhetoric has been the hallmark of budget speeches of the present finance minister.

Despite the track record, there was some hope that in this last full budget of the Modi government before the general elections, there would be some attempt to put money where needs of the people are.

Unfortunately, the budget reflects a callous attitude towards the crisis of livelihoods faced by people at large, does not allocate adequate resources to sectors that are facing major challenges, and makes no attempt to revive economy.

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A number of flagship programmes have seen a large cut in allocation of funds. The food subsidy has been cut from Rs 2.87 lakh crore to Rs 1.97 lakh crore.

Ignoring the continued global fertiliser shortages and price inflation, fertiliser subsidies have been reduced from Rs 2.25 lakh crore to Rs 1.75 lakh crore. Allocation for agriculture and allied activities has been reduced from Rs 4.65 lakh crore to Rs 3.54 lakh crore.

The budgetary allocation for PM-KISAN has remained stagnant and is not adequate to provide the promised Rs 6,000 to 12 crore beneficiaries.

Not taking any cognisance of the job crisis, allocation for employment guarantee programme has been cut from Rs 89,000 crore to Rs 60,000 crore.

The cuts in petroleum subsidies are a major depressor for economy since 2021-22.

Petroleum subsidies have been reduced to a meagre Rs 2,000 crore in Budget 2023.

LPG subsidies amounted to Rs 37,000 crore in 2020-21. With progressive reduction, they have been brought down to a meagre Rs 2,250 crore.

The experience of the pandemic notwithstanding, the government has not shied away from cutting even the expenditure on health.

Last year, the government did not even spend the Rs 87,000 crore allocated for health.

This year, Rs 89,000 crore have been budgeted for health, which accounts for 2 per cent of the total government expenditure, dropping from 2.2 per cent last year. In the case of education also, allocation has fallen from 2.6 per cent of total expenditure to 2.5 per cent of total expenditure.

To sum up, the budget is a colossal disappointment. The government is in denial of the crisis that the Indian economy faces. It is thus not surprising that it has presented a budget that does not allocate resources in a manner that would deal with this crisis.

On the contrary, budget deepens crisis of economy and intensifies hardships of masses.

- Professor, Centre for Economic Studies and Planning School of Social Sciences, JNU