THE UNION BUDGET OF 2021 presented by Finance Minister Nirmala Sitharaman fails on the A, B, C and D of Budgets. Here is how.
It fails in the areas of Agriculture, Banking, Covid and Defence.
Let us examine them one by one.
Agriculture virtually saved India during the pandemic. While factories shuttered and the service sector floundered, the farmer continued to toil. Crops did not fail. They were planted on time, they were irrigated on time, and they were taken care of. The farmer toiled and it was the primary sector that helped us tide over the crisis. The farmer did not fail, and neither did the agricultural marketing and mandi system. But the Union Government failed.
Amidst jumlas of doubling farm income, agriculture has received an increase of only 2 per cent. How does the Government ensure a 100 per cent increase in income with only a 2 per cent increase in expenditure? However, even this 2 per cent increase is not accurate on many counts.
The outlay on rural development has been reduced by 34 per cent. Yes, you heard it right. Rural development outlay has been reduced by more than one-third. Agriculture and rural development are interrelated, and the 2 per cent increase in outlay will eventually be brought down by the 34 per cent decrease in rural development funds. Moreover, the cess imposed in the Budget goes entirely into the Union Government’s kitty, and the states receive nothing from this cess.
The Budget also failed the banking sector. One had hoped that due to the financial downturn, the Budget would create avenues for easier access to banking for both agriculture and Small and Medium Enterprises (SMEs). The banking sector required an influx of almost Rs 2 lakh crore. However, the Budget has only provided Rs 20,000 crore to the banking sector, one-tenth of what is needed. How would the SMEs emerge out of recessionary trends if they do not have access to easier banking facilities?
The outlay on rural development has been reduced. Agriculture and rural development are interrelated. The 2 per cent increase in agriculture will be brought down by the 34 per cent decrease in rural development funds
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Covid is another area where the Union Budget has failed miserably. One had hoped that the Union Government would be putting a system of pandemic preparedness in place. The experience of a global pandemic has demonstrated that economies of countries that tackled the pandemic well have been the first to rebound. Contrast the US, the UK, France and Italy’s performance with New Zealand, Vietnam, Taiwan and Thailand, and you can see the difference in eventual results. The fact that India was ranked 86th in the world on the Covid Performance Index does not seem to have bothered the finance minister, who woefully ignored addressing the issue.
Global connectivity implies that epidemics and pandemics will occur and spread rapidly as compared to previous centuries. One has to look at recent history to realise that our generation has faced multiple epidemics, be it AIDS, SARS, Ebola or Covid. The times will be very challenging and we need robust systems to evaluate, monitor, predict, prevent and thwart the spread of pandemics. The Budget has failed to initiate any steps in this direction, and future generations will have to pay for this.
Defence is another sector that requires urgent attention, which the Union Budget ignores. A mere 1 per cent increase has been allocated to defence at a time when the nation is facing greater threats on the eastern, northeastern and northwestern fronts. Is a 1 per cent increase in the defence budget enough to tackle the combined threats posed by revisionist powers? Has the Union Government forgotten the heroics of our soldiers in the Galwan valley?
I spoke of A, B, C and D, and I could also talk about E, that is, education. Though this sector suffered due to Covid, it has received a mere 5 per cent increase in allocation.
In Punjab, we are seriously confronted by all of the above challenges: Agriculture, Banking, Covid and Defence. The Union finance minister has failed us on all four counts.
The Budget tries to unsuccessfully court another set of A, B and C—which is Assam, Bengal and Chennai that are going to polls this year. However, the electorates of these states are smart. They will not fall for such shoddy stratagems.