Union Budget 2018: Four Comments
3 views
Skip to first unread message
Sukla Sen
Feb 1, 2018, 7:57:17 AM2/1/18
to foil-l
[I. <<For once, it was not content so much as form that made news from a Budget speech. Finance Minister Arun Jaitley on Thursday primarily delivered the speech in English but, for possibly the first time, he read out large portions of it in Hindi too. The move was unusual, with Jaitley evidently stumbling over unfamiliar words while reading his speech out in the Lok Sabha. But the intention was clear. The government wants its announcements to make their way to the masses, which, when you look at the primary constituency of the Bharatiya Janata Party, are mostly Hindi-speaking residents of the so-called cow belt.>>
(Excerpted from sl. no. I. below.)
II. <<While the minutae of the Budget will be analysed in the days to come, it is now clear that the government is in pre-election mode and will do everything in its power to reach out to the masses, or, in other words, the voters. In the last two years or so, it has done all it can to shed the perception of being a ‘suit boot ki sarkar’, conscious that while big business may fret about the economy, it is the vote of the common citizen that counts.
The corporate sector, which had lost no opportunity to criticise the UPA for its ‘wasteful expenditure’ by way of schemes such as MNREGA, must surely wonder if, at least where populist schemes are concerned, the NDA is not another avatar of the previous government. But Modi is politically savvy enough to know that in an election year, it does not pay to be seen as too business friendly.>>
(Excerpted from sl. no. II. below.)
III. <<Budget completely fails to address the job creation in rural areas as is visible in no mention of NREGA or even 50% cut handloom sector allocation but the focus remains on big business and entry of private corporations to the villages at the cost of the human labour. In spite of the rapid urbanisation, villages and agriculture remain the soul of India where more than 50% of the population lives and is still employed. They will not survive the #digital economy or the focus on the digital governance, the poor of this country need more tangible things not the virtual and artificial intelligence.>>
(Excerpted from sl. no. III. below.)
Only time will tell how the "rural" and "pro-poor" posturings will translate in terms of actual actions on the ground and in terms of garnering votes.]
I/IV.
BUDGET 2018
MSPs, ModiCare and Hinglish: Jaitley’s Budget speech tries to shore up Modi’s rural credentials
Whether they will be able to deliver on promises is another matter, but Modi and Jaitley are clearly concerned about rural votes.
MSPs, ModiCare and Hinglish: Jaitley’s Budget speech tries to shore up Modi’s rural credentials
PTI
2 hours ago
Rohan Venkataramakrishnan
For once, it was not content so much as form that made news from a Budget speech. Finance Minister Arun Jaitley on Thursday primarily delivered the speech in English but, for possibly the first time, he read out large portions of it in Hindi too. The move was unusual, with Jaitley evidently stumbling over unfamiliar words while reading his speech out in the Lok Sabha. But the intention was clear. The government wants its announcements to make their way to the masses, which, when you look at the primary constituency of the Bharatiya Janata Party, are mostly Hindi-speaking residents of the so-called cow belt.
The speech too seemed directed at addressing the belief that the government has not done enough to keep rural markets happy. Jaitley said from the very start of his budget discussions that agriculture would be the focus of this year’s policies. In the speech too, after going through a laundry list of what his government has achieved, Jaitley spoke of directing these benefits to “farmers, poor and other vulnerable sections” and “particularly focus on strengthening agriculture and rural economy.”
Farmer incomes
Jaitley’s first big announcement also stuck to this line. After reminding people of the government’s commitment to doubling farmer incomes by 2022, an effort that has failed to see much movement so far, the finance minister explained how he is going to try and make this a reality.
“In our party’s manifesto it has been stated that the farmers should realise at least 50% more than the cost of their produce, in other words, one and a half times of the cost of their production,” Jaitley said. “I am pleased to announce that as per pre-determined principle, Government has decided to keep MSP [Minimum Support Price] for the all unannounced crops of kharif at least at one and half times of their production cost. I am confident that this historic decision will prove an important step towards doubling the income of our farmers.”
Ground realities on this might turn out to be less rosy than this announcement. In the past minimum support prices for other crops have also been declared at 1.5 times their production cost, but that has not led to actual gains for farmers. Jaitley in his speech admitted that increasing MSP is not enough, and said that the Centre will work with the Niti Aayog to figure out a “fool-proof” mechanism for farmers to get adequate prices for their produce. Naturally, one can expect that this consultation with Niti Aayog will not conclude anytime soon.
ModiCare
Jaitley’s other major announcement is already being referred to by same as “ModiCare”. Officially the Ayshman Bharat scheme, the finance minister said that the government is launching a National Health Protection Scheme, which will cover more than 10 crore poor and vulnerable families. He claimed these families, counting in approximately 50 crore beneficiaries, would get up to Rs 5 lakh per family per year for secondary and tertiary care hospitalisation. Jaitley called this “the world’s largest government-funded healthcare programme.”
As with the MSP announcement, what actually transpires on the ground might turn out to be different. The very fact that this provision of healthcare is through insurance rather than directly at government institutions, raises concerns about whether the system will be gamed by private organisations simply to mop up money under the scheme. The other question is how much will actually be allocated and disbursed. But the phrase – the world’s largest government-funded healthcare programme – is likely to form the centre-piece of the BJP’s messaging around its budget.
The other two significant announcements from the budget might actually be seen as negative by some, but again they might come as a positive for rural India. One is the re-introduction of the Long Term Capital Gains tax, which taxes any gains made from instruments like stocks beyond a certain threshold. The move will be criticised by the middle-class and the rich, but it will not have much of an effect on the rural economy, other than possibly giving the government more money to work with.
Poll perspective
Finally, Jaitley said that his government is going to slip from its fiscal targets. In his budget speech last year, he had laid out a commitment to keeping the fiscal deficit – the difference between government revenue and expenditure – to 3.2% of the budget. Jaitley said that the number will actually be 3.5% this year, and he hoped to bring it down to 3.3%. This is troubling for credit and will see bond yields going up, but it implies that the government is trying to spend its way out of bad economic conditions. Although the budget documents will have to be carefully fisked to see if that money is actually going to make its way to the rural economy, the messaging suggests government intends for it to.
Why such a focus on agriculture and healthcare for the poor? The broad belief, reinforced by the results in the Gujarat elections, is that urban centers continue to support the BJP, but rural areas have drifted away from the party, especially after the economic hit they took following demonetisation. General election are due in India in 2019, and there has been plenty of buzz that the government might considering advancing it to later this year. A budget with big announcements for the rural economy is an attempt to address this, although the fine print – and actual implementation – will tell us if it will be enough to address concerns in the countryside.
II/IV.
Budget 2018: In An Election Year, it Doesn’t Pay to Be Seen as Too Business Friendly
BY SIDHARTH BHATIA ON 01/02/2018
Finance minister Arun Jaitley’s entire emphasis has been on the poor, with a few tweaks to the salaried, income-tax paying classes almost as an afterthought.
Finance minister Arun Jaitley with PM Narendra Modi. Credit: PTI
New Delhi: With eight state elections scheduled to be held this year, and the general elections due soon after, it would have been surprising if the Narendra Modi government had not presented a Budget that was aimed at the bottom of the economic pyramid, as it were.
Finance minister Arun Jaitley has not disappointed – his entire emphasis has been on the rural sector and the poor, with a few tweaks to the salaried, income-tax paying classes almost as an afterthought. As for the corporate sector, it cannot possibly be delighted at Jaitley’s proposals, simply because there was nothing in them to particularly enthuse them or spur investment. Not surprisingly, many of the bosses sitting in television channels looked a bit underwhelmed.
The big idea in Jaitley’s Budget is, of course, a healthcare scheme for 100 million vulnerable families, which he said could translate to 500 million Indians – almost 40% of the country’s population. Each family will get free insurance of up to Rs 5 lakh fully paid for by the government, on the lines of Obamacare. In a country where an illness can wipe out a family’s net worth, this scheme, if properly implemented, can provide much succour and undoubtedly the Modi government hopes and believes that it will please the masses.
This hope may not be fully realised. In the last Budget, the government had announced the National Health Protection Scheme, allotting Rs 1 lakh to each family for healthcare. The scheme has remained a non-starter.
Also read: Budget 2018: Jaitley’s ‘World’s Largest Health Programme’ Rejigs Flailing Old Ones
Two critical questions about the new scheme remain unaddressed – first is the creation of sufficient infrastructure in rural and small town India, where even district level hospitals are poorly equipped and incapable of serving the local populace. So will this scheme be a mega opportunity for the private sector and big corporate hospitals?
The bigger question is, where will the money to fund this scheme come from?
The same concern applies to the plan of giving free electricity to four crore rural homes, an election sop if ever there was one. The Budget outlay is Rs 16,000 crore, which will add to the government’s burgeoning deficit.
The fiscal deficit in the last year stubbornly refused to remain within the pegged target of 3.2%, rising to 3.5%. The introduction of the Goods and Services Tax is said to be the reason for this. In the coming year, the government plans to achieve a target of 3.3%, surely a case of misplaced optimism.
Not surprisingly, barring a few adjustments to individual income tax, such as a higher slab for medical and transport reimbursements for salary payers and concessions to senior citizens, the finance minister has left the tax structure untouched. The much expected introduction of the long-term capital gains tax, which stock market players were dreading, dampened spirits at the bourses, but the finance minister has no option but to mop up every rupee he can get.
While the minutae of the Budget will be analysed in the days to come, it is now clear that the government is in pre-election mode and will do everything in its power to reach out to the masses, or, in other words, the voters. In the last two years or so, it has done all it can to shed the perception of being a ‘suit boot ki sarkar’, conscious that while big business may fret about the economy, it is the vote of the common citizen that counts.
The corporate sector, which had lost no opportunity to criticise the UPA for its ‘wasteful expenditure’ by way of schemes such as MNREGA, must surely wonder if, at least where populist schemes are concerned, the NDA is not another avatar of the previous government. But Modi is politically savvy enough to know that in an election year, it does not pay to be seen as too business friendly.
III/IV.
#Budget2018- Key Demands of Agriculture Community Ignored; Push for Corporate and Commodity Farming and Trading
[NAPM Press Release]
Posted by :kamayani On : February 1, 2018
Snipped
IV.
Budget 2018 decoded: 15 goods, 3 bads and one ugly move from finance minister Arun Jaitley
ET Online|Updated: Feb 01, 2018, 04.35 PM IST
Like every Budget, this one too has its positives and negatives. Finance Minister Arun Jaitley presented a mixed bag of a Budget for the financial year 2018-19, including the good, the bad and the ugly. Read on to know whom the Budget has made happy, who is sad, and who has been devastated:
Snipped
Peace Is Doable
Reply all
Reply to author
Forward
0 new messages