Budget, an account of the approach of the development planning of the government, has been laid in the parliament of India for the financial year 2020-21. This is a historical period for India because India is vehemently doing away with many of its long-pending decisions.
The assessment of the recent actions taken will take time, but at this point, we witnessed the President of India devoting a whole paragraph about the issues of unrest in India in his presidential address on the eve of the Budget session. The parliament clapped on both the issues for almost one and a half minutes. That gives multiple messages about the future course of actions. Meanwhile, the union government has imbibed the theme of “Care” to give shape to its budget.
The major themes of the budget are targeted towards making India 1. An aspirational 2. Economically developed 3. Caring society. These three pillars appear to be in direct sync with the Human Development perspective. It also challenges the traditional path that India has followed, i.e., of visualising things with the lens of social justice and being a paternalistic nation.
This time, after the LPG of the 1990s, the government has opened the pathway for corporates to come even closer and deeper into the lives of citizens. It has also made paths for youths to get deeply engaged in governance. The final financial management will definitely decide the intensity of the programmes, but the budget must be assessed on the rubrics of subjective principles.
The budget is aggressively targeting mobilisation of stakes in the bloodlines of the economy from corporates and international supply chain. It aims to deepen the corporate partnership in education, manufacturing, banking, capital, energy, and transport sector. This huge declination of the government from operation management role and tilt towards regulation is a clear indication of making India more of a capitalist economy.
The government has encashed its trust in the corporate sector to bring the fire in the economy. The fiscal deficit has been compromised by 0.4%, which is a great deal, but yet eligible to be considered conservative. The relaxations in taxation and cleaning the systems by removing the complicating norms is definitely a clear way for the other players to take over. Thus, this budget appears to be more for rescuing Indian economy, and hence, may bring a lot of space for the global economy to fight the deep dearth of consumption.
The budget announces faster communication of farm goods through Krishi Udan Scheme and better storage infrastructure to increase the value of produces. Hence, it is clear that the approach of the government is to make the internal market more flooded with local produce, and thus, mitigate the international trade deficit.
Rather than having an ambitious plan of making India a manufacturing hub, for one year, India wants global manufacturers to have some breathing time in India by being the assembling hub of global goods. That means, India recognises its higher-order skill deficit, and to face the challenge of unemployment, this middle path has been harped on. So, overall, India is trying to utilise the global supply chain to put its own things in place. This is a safe path and hence comes with a limited scope of growth.
Perhaps, the jump from the agrarian economy to a service economy is making India pay the price of ignoring the manufacturing aspect. In other words, ‘Make in India‘ needed a neck-support and that is ‘Assemble in India‘. The overall picture seems to be increasing export of services and personnel and a significant increase in import of goods. What India should now do is prepare its human capital to excel on the global technology and focus its import more on the technology rather than importing finished goods.
The transformation of the base of Indian Taxing System from an exemption in the receipt amount of income has definitely made the tax operation easy. The deduction in tax rates doing away with the jungle of tax-evasion ways is a win-win situation—both for tax enforcement hands of the government and the taxpayers.
Although it has brought some risks like instant retardation of the flow of funds in the social development sector or other donations or investments, now when a systemic erosion of exemptions has been announced, the investor has to know where the money brings the highest returns clearly. Probably, it may bring a kind of greater stability in the mutual fund investment market.
The promotion of MUDRA in SHGs and bringing more liquidity under the increased borrowing limits makes a mark of improvising life through increased economic activities. The aspiration of utilising the barren lands to produce solar energy indicates the direction of invoking subsidies from oils. Overall, what is being sensed is that there is a push to the deeper monetisation of life-processes, and hence, there is a shrinking space for subsidised living.
The special focus on the mobility of farm produces definitely underlines the priority of the government. These initiatives are in the right direction and are not a mishit in the rally to increase the farmers’. The 16-action point to revitalise the rural economy started with establishing a clear regime of land-leasing. That’s a multi-dynamic approach from decriminalising the society. NCRB report of 2017-18 and 2018-19 say that the biggest cause of murders in politically-sensitive states like Bihar and UP is the Land Dispute. Now, if we fix the land disputes in the great Gangetic Plain, it will definitely increase the production and the well being of the farmers.
The focus on regulating the processes for entrepreneurs to ensure ease of doing business is definitely a good step. The special mention to boost infrastructure is something very much expected. The five new smart cities, which are announced to be developed are in SEZ, and hence, strategically important.
The emphasis on the necessity of clean air in cities is one of the most serious issues when global warming is set to increase in the next decade. The effects of climate change will be directly decreasing the efficiency of the workforce. In that condition, regardless of the geography, the cold-chain infrastructure will be inevitable for sustained integrity of supply and consumption cycle.
With increasing population, the resources are under tremendous pressure. The livestock, food grain, real estate, textile, healthcare, civil aviation and railway are some of the basic industries having interaction with each life on a daily basis. The intimate relation of disease outbreak, transportation & food industries and the healthcare safety net is something obviously clear. Hence, increasing the safety of livestock and human touch is essential for safer societies, which requires huge investment in the infrastructure of storage and processing of edibles and transportation of human beings.
The budget mentions building the infrastructure as a single point agenda to provide appropriate conditions for development and to take care of health; it plans to intensify the existing structure. To inject new institutions, it has harped on local bodies and the corporates.
The government has decided to inject almost one lakh crores in human resource Development along with skilling. It appears to be a great sum of allocation, but when the huge education system is kept against this allocation, one may not be very impressed. The government realises it very much, and hence, it has pronounced private partnership in Higher Education. The education system is being oriented more towards quality with good direction, but the divided attention towards research and development in school and colleges is not very much appreciated.
Education in India is basically an affair to be dealt with locally under the purview of Local Bodies. In the independent history somewhere, we have separated the development of the society and education of society members. Those who decide to get into local politics are the ones who leave school first. In last 7 to 8 years, several fellowships like Gandhi Fellowship, SPARC-Swaniti Fellowship, PMRDF, CMGGA, Smart City Fellowship, Aspirational District Fellowship, Swaccha Bharat Prerak Fellowships have proved that the youngsters may also contribute in a radical change in the development dynamics.
This appears to be a base for the government to continue with the ODF Plus, expanding Smart City Mission and opening Urban Local Bodies for engineers to engage in the planning of urban constituencies. The engagement of engineers in local bodies may be taken as a bluff for the rising demand of employment by youths, but the aforementioned fellowships have underlined themselves as a process which empowers the core of the skills of our youngsters. It may be a revolutionary step in providing India with a planned development and may bring confidence in the government to open its three-tier Panchayati Raj system to professional planning with the help of technically-skilled youngsters.
Thus, this budget appears to be normalising the fire and directs its energy for long-term empowerment of the nation; of course, the cost is a temporary loss of gratification.
The nation is moving towards serious structural reforms, and the reforms are going to test the clarity of operability of states and local bodies. This approach will definitely bring the glamour of Sensex a bit down, but it will eventually strengthen the federal structure of the nation. It will materialise the concept of direct democracy through the increased role of the institutions of local self-governance. This budget may not have made the day of the profit makers of the corporate world. Still, it has kept economic development at the centre of its approach—both for the institutions and for individuals and strikes a fine balance between the roles of government and private sector. Let us join hands and build a care network…