By Manish Anand
New Delhi, February 2: Prime Minister Narendra Modi should ever be in gratitude to the Indian media. This is evidently for the fact that the Indian media goes gaga even where there is no element of news. The interim budget took a longshot of the ‘Vikasit Bharat’ sloganeering by 2047 to pack contents from the announcements made by the Prime Minister in recent days and weeks.
Neelkanth Mishra, chief economist of the Axis Bank, in a lead article in the Indian Express hinted at a disturbing side of the lethargy in the Modi government, hinting possibly on mismatch between spoken words and actual action in spending. Mishra wrote: “When government cash balances reach level of Rs 3 to 4 trillion higher than normal, as they were last week, liquidity stresses in the banking system intensify far more than intended by the monetary policy, undoing some of the gains from fiscal discipline.” To this Sitharaman has assured that the government will be seeking less borrowings.
Headlines from the interim budget were – rooftop solar scheme, ‘lakhpati’ Didi, urban and rural housing, etc. The rooftop solar scheme was announced by the prime minister after his return to the national capital from Ayodhya where he led the consecration ceremony of the idol of Ram Lala. Modi had spoken of ‘lakhpati Didi’ in his Red Fort speech last year. Housing scheme is also a legacy programme.
“You don not need to listen to budget speeches to know about the policy direction of the government. You should just follow the prime minister. The budget is now reiteration of announcements made by the prime minister, as well as decisions taken by the departments on a regular basis,” said a top ranking government official.
Ravi Shankar Kapoor, a senior journalist, drew satisfaction from the fact that the interim budget was without a fresh set of announcements. “It is better if the government doesn’t do anything,” he said.
However, agriculture expert Ashok Gulati and others had warned in the run up to the interim budget that the rural income in the last five years hasn’t gone up. UTI Mutual Fund in a report on the interim budget stated that the impact will be positive only two sectors – renewable energy and banking. IT listed nine sectors to have neutral impact from the interim budget.
The SBI Securities in a report on the interim budget stated that there was a marginal increase for the Railways. Incidentally, the national rail transporter is being counted as the focus area of the Modi government for higher public spending to spur the economy. The reported stated that there is a “marginal increase in allocation towards railway budget to Rs 2.55 trillion for FY25E vs. Rs 2.4 trillion for FY24E”.