Paromita Das
GG News Bureau
New Delhi, 23rd July. As the Union Budget for 2024 is set to be presented today, Bharat stands at a pivotal moment grappling with significant economic challenges. Traditionally seen as an accounting document, the Union Budget transcends its role as a ledger of expenditures and revenues, serving instead as a powerful signal of the government’s priorities and policy direction. This year’s budget presentation comes amid pressing issues such as unemployment, inflation, and growing income inequality that demand urgent and strategic interventions.
Stark Realities from Recent Surveys
Recent surveys like the Annual Survey on Unincorporated Sector Enterprises (ASUSE) and the Household Consumption Expenditure Survey (HCES) paint a grim picture of the economic landscape. A substantial portion of the Bharatiya population continues to earn very low incomes, with economic growth over recent years predominantly benefiting the small elite. For the majority, real wages have stagnated, leading to increasing frustration and economic disenchantment among the masses.
Electoral Promises vs. Policy Outcomes
Despite the ruling Bharatiya Janata Party’s electoral promises to uplift the poor, youth, and women, the actual policy outcomes have largely maintained the status quo. The informal sector, which is the backbone of Bharat’s economy, has been particularly hard hit by policies such as demonetisation and the abrupt implementation of the Goods and Services Tax (GST), further exacerbated by the economic fallout from the Covid-19 pandemic.
GDP Growth vs. Domestic Consumption
While Bharat’s GDP is growing at a faster pace compared to many other countries, growth in domestic private consumption remains sluggish. Household indebtedness is rising, and private investment has not picked up significantly despite various incentives from the government. The strategy of increasing public investment in capital expenditure—from 1.6% of GDP in 2014-15 to 4.3% in 2023-24—has been aimed at creating jobs and stimulating private investment. However, the anticipated returns from this approach have yet to materialise, casting doubt on its effectiveness.
The Neoliberal Agenda and Its Implications
The government’s neoliberal agenda, which emphasizes market-based solutions and the role of “wealth creators,” has led to a regressive taxation system that favors large corporations. Concurrently, there have been cuts in social sector spending, with significant reductions in health and education budgets. Allocations for critical welfare schemes like the Anganwadi programme and the National Social Assistance Programme (NSAP) have also decreased. Reports indicate that the share of health spending in the Union budget has halved since 2014-15, while the education budget has similarly declined.
The Need for a Paradigm Shift
As the Finance Minister prepares to present Budget 2024, it is evident that a paradigm shift in policy is urgently needed. The budget should address the pressing issues of unemployment, inflation, and income inequality head-on. Increased investment in social sectors, a more equitable taxation system, and a focus on boosting domestic consumption and private investment are crucial steps that need to be taken.
Conclusion
Today’s Union Budget is more than a mere financial statement; it is a declaration of the government’s commitment to addressing the economic challenges facing the nation. With the right policies and priorities, the government can steer the country towards inclusive growth and economic resilience, ensuring that the benefits of development are equitably shared among all segments of society.
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