Seizing the Future

Budget is a political statement in numbers. It is not a vision statement, as some of its ardent readers expect it to be, but a spreadsheet of governance. The vision thing is spelt out elsewhere, and most eloquently, on the stump. Combining expediency with expectations, budgets unveil hope with restraint.

On July 23, Nirmala Sitharaman presented her seventh Union Budget in the afterglow of Narendra Modi’s third consecutive General Election victory. The Budget is his government’s immediate economic response, and its text is as revelatory as its political context—BJP in power without a majority of its own and allies who need to be rewarded.

Still, the Budget, despite its generosity towards the coalition partners in Andhra Pradesh and Bihar, is not a case of irrational exuberance generally shown by populists. If it celebrates anything, it is realism, and that is what a country like India, whose inequalities are matched by its aspirations, deserves most.

Modernisation lowers inequalities, and it is as a moderniser with the necessary vocabulary to converse with the future that Modi first mesmerised India. His appeal across the classes and his authenticity as a politician who has mastered the emotional content of demography make him one of democracy’s most popular rulers. He has maintained the difference between, to borrow the analogy of an American politician, the poetry of campaigning—which he has in abundance— and the prose of governance, which at times disappointed some of his initial cheerleaders who wanted him to be an Indian version of a Reagan or a Thatcher. Modi, even as he remained on the right side of the economic argument, did not let his modernisation project free of his politics’ cultural content. Comparative studies were not the adequate tools to measure the depth of his politics or economics. Still they are not.

Modi has not brought the flamboyance of the arena to his administration. The sense of gradualism that accentuates his modernisation runs through his Budgets, and they testify how he navigates the inequalities of India and taps into its dreams. This one is not different: its fiscal orthodoxy is as apparent as its commitment to ‘Viksit Bharat’ (a developed India by 2047). Sitharaman may not have indulged the salaried middle class, but her focus on infrastructure and brave attempts to bridge the demographic divides of a country that defies the comforts of homogeneity must be appreciated.

India is young in its demographic make-up. Bringing the youth to the larger story of nation-building is a political challenge as well as an economic responsibility. The Budget’s focus on not just job creation but training a generation to become skilled in a world where only the smartest survive in the job market shows how the urgencies of the future matter as much as the exigencies of the present. As the finance minister said at the ‘Open House’ event on July 26, “It is a futuristic Budget.”

In the end, what brings economics closer to everydayness is social realism—and you may achieve this without being a socialist. The social reality of the world’s fifth-largest economy will not allow the withdrawal of the state from the lives of its people. India has come a long way from the populist potency of a slogan such as ‘Garibi Hatao’, but it still has a long way to go before making development truly inclusive. By caring for farmers and women without the overzealousness of a nanny state, the Budget acknowledges that modernisation works better when it has a social conscience.

In another time it was the socialist state that managed development, and it was certainly not glorious to be rich. India is a different country today, and capitalism here can survive without cronyism or the fear of licence raj. To be rich and young in India is very normal, and the trajectory of the startup nation confirms that there is no going back. The Budget accelerates the journey.

On July 23, Sitharaman had the choice. She could have easily played the populist, turning the Budget into a political campaign by other means. She could have played the finance minister of shock-and-awe launches. She chose the path of a cautious capitalist with compassion. The Modi decade in Delhi has already made the India story a cultural saga and a political thriller; the economic endeavour remains steady rather than dramatic. Budget 2024 shows again why it should be so with enough clarity. Nirmala Sitharaman has only spelt out the essential traits of Modi’s modernisation.

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