Through this year’s union budget, Pranab Da has introduced a remodeling of vintage qualities that kept surfacing during his budget speech. Stark fetishism started with an unknown nexus among godly characters of Indra, Laxmi and that finally ended with number 3- his own favourites in life and remorsefully in his party. As a follower of budgetary exercises for years, I am yet disagreed with corporate and intellectuals like Bibek Debroy who sensing the ineffectiveness of budget in general term. My incorrigibly optimistic mind still sticks to the frame that sees public exercises of resource as most remarkable set of entitlement disbursement. Indeed this year’s budget marks stout complexity within itself as it was made by some of the finest brains in the discipline of economics/financ. So, in technical terms and at-a-glance perspective, it presents amusing leverage to populist temptations on which a democracy of our type rests.
Finance minister, generously enhanced the remunerations of aanganwari workers and teacher to double their present Rs 750 and Rs 1500 into Rs 1,500 and Rs 3,000 - albeit he failed to sense that it’s still less than minimum wage recommended by his own government. In another move of social service, budget introduced enhancement of old age pension from Rs 200 to Rs 500 but with an inhuman clause that makes eligibility quite tough at the age of 80. Only good thing was the relaxation of age for attaining the senior citizenship from 65to 60.
Amazingly, the hands of the finance minister suddenly found momentum while dealing with the corporate sector. In last six years, Rs 3,74,937 crore {twice of 2G scam} worth of corporate tax have been written off.
A section of observers are noticing that India is in surprisingly good fiscal shape despite populist spending, venal politics and bad-governance but they are summarily ignoring the huge cut in subsidies on petroleum and fertilizer. On the revenue side, contentious DTC, MAT, DDT being regarded promising for midterm but euphoria will be short lived with the abysmal growth of 3.5% in expenditure with an exception of Rs 3, 000 crore for oil subsidy bill. The statistical flex in fiscal deficit that fall from 5.5 percent to 5.1 percent - owing to rise in nominal GDP from Rs 69.35 lakh crore to Rs 78.78 lakh crore in 2010-11 - thanks to incessant inflation. This fortunate increase in nominal GDP further enhanced the debt to GDP ratio by 65 percent {Economic Survey} against the projection of 76.8 percent [IMI}and 68 percent Thirteenth Finance Commission}…but such boom is hardly justifiable with a foregone history of panic of price rise in public-distinct and much acute than Maslow’s hierarchy of needs.
The union government’s total expenditure as a proportion of GDP is projected to fall from 15.4 percent in 2010-11 to 14 percent in 2011-12, which reflects that expenditure fall for reducing deficits is the overarching feature of this Budget. Despite the claim of prioritization for social services in the union budget-expenditure fall on this segment from Rs 1,62,501 crore in 2010-11 to Rs 1,65,975 crore in current financial year, where a sharp rise was genuine due.
Announcement for scholarship among school students from schedule castes is a welcome step with a total allocation of Rs 1469 crore for this categories educational welfare but no special attention were given to STs, they have allotted a static Rs 1265 crore. Another big concern is financing of Right to Education under SSA which will be fall short by Rs 12,000 crore annually despite a hike from Rs 15,000 crore to Rs 21,000 crore in current year.
On health, total allocation of budget has slightly moved up but fall short of the commitment during UPA-I. NRHM has been given Rs 17, 920.76 crore which is still a meager amount to deal with the needs. Rural water supply received a timid increase from Rs 8100 crore to Rs 8415 crore and rural sanitation from Rs 1422 crore to Rs 1485 crore. In urban water supply and sanitation allocation for the integrated low cost sanitation programme has been reduced from Rs 80 crore to Rs 71 crore.
Agriculture got the most shocking treatment with total expenditure on the rural economy declined from 3.3 percent of GDP in 2008-09 to 2.3 percent in 2011-12. Funds for most of the schemes have been cut by 10 to 40 percent.
Sadly, the budget brought nothing more than a Pandora Box, full with disappointment and ambiguous complexity. If the government is serious on leading budget beyond the scenic beauty of statistics, it must think seriously on crumbling edifices of democracy-governance, accountability, fairness and public services.
