This was the budget to which we set high expectations. I thought that the budget would understand the condition of the economy especially the macroeconomy and give necessary solutions for it. Today we are at the place where we have the lowest growth rate of the last decade.
Months later, industrial growth has come in a positive direction, although it is still at a miserable level of 2.8 per cent. Combining all this, our growth rate is currently 4.5 percent. Along with this, the prices are increasing, the rate of investment is decreasing, and if we combine the figures of the National Sample Survey report which have leaked to us, then the female unemployment rate is increasing and The process of reducing poverty is going in the opposite direction.
However, instead of these available facts and figures in the Economic Survey of 2019-20 presented in Parliament on Friday, only the Central Statistical Organization’s five percent growth rate has been accepted. Given these circumstances, I hoped that some serious steps would be taken on difficult paths. But the general budget of 2020-21 appeared to be growing on the populist path, keeping these problems at bay.
Politically, this was also the right time to build hope, as this was the first full budget of this government after getting a huge mandate. The government has announced several schemes this time. But nothing has been said about the expenditure of the previously announced schemes, so it is not possible to compare. It is to be hoped that in the expansion of expenses there may have been an attempt to move towards the solution of the original problem.
Now let’s look at some interesting things. All the old plans have been repeated. Whether it was the planning of 150 distressed districts in terms of groundwater level, or the plans to collectively build storage systems, or the schemes of the fisheries industry, these were good plans and needed to be continued. Similarly, the emphasis placed in the budget on culture, tourism, food and networking is also very important. The mention of modern statistical system is also a good thing. But the way in which investment in infrastructure needed to be increased did not appear. If this had been done, there would have been a possibility of a surge in private investment by the end of this year. After this, it is also expected that due to this, the manufacturing will start increasing for six months.
The Reserve Bank has stated that its interest rate policy will be effective only when the financial gap can be bridged. But only superficial work is shown in the budget.
Budget estimates are compared to revised estimates. The experience of the last few years is that spending is reduced due to lack of resources at the end of the year. If we just look at the budget estimate, then it does not appear to be a new budget in the economy. Compared to the previous budget estimate, it is indicated by the expenditure on infrastructure. And when detailed information comes, it may be that the expenditure on infrastructure appears to be negative.
From all these things, the budget presented by Finance Minister Nirmala Sitharaman in Parliament cannot be said to be at least a budget to get relief from recession. This budget is following the path where others are being asked to invest. The budget is nothing but a short-term annual document. Now because the government has already finished (long-term) planning, it does not spend on economic and social infrastructure. There is no point in raising expectations from non-banking finance companies and public sector units as they are accountable to their board of directors and more activism becomes a snuggle. In such a situation, where can we expect to get rid of recession?
When the budget strategy sets expectations from others for investment, it happens that it announces several reforms. But at the same time we also have to understand that even though economic and financial reforms are very much needed, it takes a long time for them to reach the end. There is no alternative to direct economic investment in the short term of a financial year. But it is also important that a phased reform strategy should be continued with this.
This budget of the central government is in front of us when we are talking about making the country a five trillion dollar economy. Actually, we have to take development strategy seriously. We have already given up the task of strategically making long term plans. The rate of growth in investment has fallen. Despite this, like Sheikh Chilli, we are talking about increasing investment very fast. If we want to take some serious steps to revive the economy, we will have to return to Yojana Bhavan. NITI Aayog Chairman Rajeev Kumar and its members like Ramesh Chandra, again long-term plans
Work will have to be done to make and execute them. We have to expect them to set a realistic goal according to our long-term ambitions. In the past, this goal has been achieved by political consensus through the Inter-State Council.
I assume that our goals should always be logical, although the truth of this period is that now we are all planners. When I met an industrialist considered close to the new government in 2014, he seemed very happy that the planning process had been completely scrapped. Hopefully they will be very sad to see what is happening now, because now we have all become planners. But now the time has come for us to accept the truth and move in that direction, when we get a good annual budget every year.