The Union Budget 2022: A Celebration of Devastation

The contradictions of neo-liberal economic policies had become evident in not only rising inequalities, but also with declining rates of economic growth. This had started since the Bharatiya Janata Party-led NDA government took over the reins of control in New Delhi. Then the pandemic came followed by some of the most callous instances of governance when a complete lockdown was imposed, and the nation saw millions lose their lives and livelihoods as incomes and jobs were lost. The rich did not suffer; indeed they continued to work from their homes and kept their jobs and incomes intact. The business class saw their incomes go up as the small and marginal traders and producers lost their markets and wound up their businesses. The lasting image was of many thousands of migrant labourers on the move. When the disease ebbed a bit and government had done little except to ease the credit lines of banks. Then the second wave arrived and people did not die as much as from COVID, as from the lack of air to breathe. The mismanagement behind the oxygen crisis led to the next lasting image of burning pyres across any open spaces, shallow graves dug on vacant land, long queues of relatives waiting to cremate their loved ones. There is total silence in the budget regarding any solution whatsoever for those whose lives have been shattered by the pandemic.

The usual fanfare during the presentation of the Union Budget for 2022-23 was noticeably missing. There was very little boasting with numbers during the presentation as is the custom with Finance Ministers in India. Only few numbers were announced, leaving the common man to figure out details from the complicated budget papers. The indication given was that it was time to go back to business as usual, giving sops for private business to grow through the use of high technology.There was a lack of energy in the parliament reflected by half-hearted thumping of tables from treasury benches and the absence of loud interruptions by opposition members. Nobody seemed too convinced about what was going on, except of course the great leader. Total expenditures went up from the revised estimates for 2021-22, but only by around 4.6 percent, which is less than the rate of inflation prevailing in the economy. Hence the real quantum of spending will be less than that achieved last year. On the allocation for capital expenditure though the increase is to the tune of around 21 percent compared to the revised estimates of 2021-22. This spending is supposed to “crowd-in” private investments according to the minister. Most of the major projects though will be started now and outcomes will be discernable not until 2025 at the earliest, while others will be visible when India turns 100, 25 years from now. Despite no major tax rate changes in either direct or indirect taxes, the budget estimates tax revenues to expand impressively through growth and improved collections. This allows the fiscal deficit to be brought down to a slightly healthier 6.4 percent compared to the revised figure of 6.9 percent for 2021-22.

The bottom of India’s economic pyramid has been lashed by the pandemic through loss of lives, livelihoods and jobs. On top of it inflation has been eating into the real income of the poor. The medium, small and micro enterprise sector has been hit the hardest. Many jobs and livelihoods may never return. Youth unemployment is at an alarmingly high level. Economic inequalities in wealth and incomes have grown to unacceptably absurd levels. The budget did not even mention any of these issues that affected the lives of millions of citizens. Last year, looking at the differences between the budget estimates of 2021-22 and the revised estimates, there have been cuts in education, health, rural development. This year’s budget estimates reduces significantly food and fertiliser subsidies-- an arrogant dismissal of the needs of the many against the greed of the few. Foreign investors can come in with tax cuts that might make India the lowest taxed haven for multinationals. The chosen sectors all indicate that if companies do enter, they will be producing high-tech goods with very little employment potential for low skilled workers. Privatisation is the key mantra for economic health. Even when the finance minister failed terribly to reach the target she set for disinvestment for 2021-22, there was much drum beating in announcing the sale of Air India and proposed IPO for Life Insurance Corporation of India.

There was much of the spectacular though, in the PM GatiShakti scheme with 4 pillars and 7 engines. It covered almost all of India’s requirements from infrastructure, green finance, sustainable development, private investments, safety nets, and of course glittering new technologies from 5G spectrum to fibre optics networks in every village,to the proposed new digital currency to be introduced by the Reserve Bank of India! These are mere announcements and even as announcements they are supposed to show results not before three to five years. There was much boasting about the prospects of creating 60 lakh jobs in five years when the actual need is to create more than double that amount in the present year.

Nevertheless, the Ram temple will be built, the central vista completed with pomp and splendour and any questioning voice of dissent will be stifled, violently if necessary. Much of the common citizens have drawn away from the arena of democratic politics. The rich use religion to serve opium to the masses. The finance minister has asked the common man to look forward to celebrating India in 2047 rather than gaze at the coming months of great uncertainty.

[Contributed by Anup Sinha]

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Vol 54, No. 33, Feb 13 - 19, 2022