This was touted as a ‘once in a lifetime’ Budget by Union Finance Minister Nirmala Sitharaman. But the clue to this year’s financial statement should have come from the Prime Minister’s words when he stated that the year had already seen 4 to 5 mini-budgets and the 1st Feb 2021 one should be seen as one in a series.
True, there was no big-ticket announcement from the Finance Minister, but there were a whole lot of markers. While no tax breaks were given, no new cess was added to the salaried taxpayer. There has been a concerted effort to increase spend in the market for all analysts talk of the importance of injecting liquidity back. That need was addressed via a two-pronged approach, the first being to increase spend in infrastructure projects, and the second is via the disinvestment route. How successful either will be remains in the implementation. The service sector specially the tourism and hospitality industry which was hit pretty badly during Covid-19 has been given no special attention. And that has left many disappointed.
But the Budget also came with a political statement, coming in the backdrop of the farmers’ protests against the new farm laws. There was no concession to the protesting farmers in the form of subsidies or any other outreach. Instead, the Finance Minister spent a considerable amount of time pointing out how in the last year the government compensation and MSP was well above the market rates. Add this with the PM’s offer of talks and you get a pretty clear idea that the government is going to remain firm on its commitment to the three reform laws and that there will be no rollbacks
The other political part of the Budget of course came in the special mention of infrastructure projects to Assam, West Bengal and Tamil Nadu. And the fact that the Finance Minister began with a quote from Rabindranath Tagore. But, having said that, this is a norm followed in every Budget and by every government, whether UPA or NDA. What again remains will be the ability to convince the poll-going states of the deliverability of these projects as none can be ready within the next three months.
And so, while it was not quite the dream Budget, it was a pragmatic Budget of the times, and perhaps the Modi government’s best Budget to date. Which in itself is a statement of account.
The Budget also came with a political statement, coming in the backdrop of the farmers’ protests against the new farm laws. There was no concession to the protesting farmers in the form of subsidies or any other outreach. Instead, the Finance Minister spent a considerable amount of time pointing out how in the last year the government compensation and MSP was well above the market rates. Add this with the PM’s offer of talks and you get a pretty clear idea that the government is going to remain firm on its commitment to the three reform laws and that there will be no rollbacks.