Budget reflects Modi govt’s new reality: Allies, job concerns, MSME issues

Gandhi posted: “Kursi Bachao Budget. Appease Allies: Hollow promises to them at the cost of other states. Appease Cronies: Benefits to AA with no relief for the common Indian. Copy and Paste: Congress manifesto and previous budgets.

The focus on jobs and by extension youth was, in fact, the most striking feature of the Budget. In the interim budget ahead of the polls, which the BJP had expected to sweep, the word “employment” had appeared seven times and “job” once. In Union Minister Nirmala Sitharaman’s Budget speech Tuesday, the words job and employment, including in subheadings, featured eight and 34 times, respectively, as she announced three “Employment Linked Incentive” schemes, apart from internship opportunities in 500 top companies for one crore youths over five years.

The Opposition can read this as a political victory, given its emphasis on the unemployment issue during the elections.

https://x.com/RahulGandhi/status/1815672226584166514

Apart from jobs, Sitharaman began her Budget speech by talking about MSMEs, and went on to refer to them 21 times in her speech. Again, the Congress was quick to point out that a helping hand to the MSMEs – struggling under the successive blows of demonetisation, GST and Covid – was another key issue for the Opposition during the elections.

The third focus was farmers, even though the Budget did not really have much for them. Among the promises was “109 new high-yielding and climate-resilient varieties of 32 crops”, and initiation of “1 crore farmers” into natural farming.

Apart from these issues, the Modi government Budget wore its alliance loyalties on its sleeve. So, there was a separate section on the Andhra Pradesh Reorganisation Act, with promises to facilitate financial support for the development of the state’s capital Amaravati, a pet project of BJP ally TDP.

For Bihar, there were a list of proposals for financial and industrial support, which are expected to help sustain the political fortunes of the BJP’s other big partner, JD(U).

In its first reactions to the Budget, the Congress said the Modi government appeared to have borrowed its ideas from its Lok Sabha poll manifesto, starting with the scheme to provide internship opportunities to youth.

The Congress manifesto had promised a “right to apprenticeship programme”, which Gandhi referred to in his campaign speeches as “Pehli naukri pakki (guaranteed first job)” scheme. Under it, the Congress said, a government led by it would provide “one-year apprenticeship with a private or a public sector company to every diploma holder or college graduate below the age of 25”, ensuring them earnings of up to Rs 1 lakh a year.

Congress communications head Jairam Ramesh posted on X: “The Finance Minister has taken a leaf out of the INC’s Nyay Patra 2024, with its internship program clearly modelled on the INC’s proposed Apprenticeship Program… However, in their trademark style, the scheme has been designed to grab headlines, with arbitrary targets (1 crore internships) rather than a programmatic guarantee… like the Indian National Congress had envisioned.”

Another Congress promise was to “create a new employment-linked incentive (ELI) Scheme for corporates”. “The Congress will reform the production-linked incentives (PLI) scheme to target specific sectors that can create thousands of jobs… We will introduce a new employment-linked incentive (ELI) Scheme for corporates to win tax credits for additional hiring against regular, quality jobs,” the manifesto had said.

On Tuesday, the Congress said the Budget’s announcement of three employment-linked schemes, including one under which the government will provide one month’s wage to those entering the workforce in all sectors, was similar to this.

Another Budget promise, of setting up working women hostels to promote their participation in the workforce, had also found a mention in the Congress manifesto. “In partnership with state governments, the Central government will double the number of working women hostels in the country,” the Congress manifesto had said.

The Congress also claimed credit for the Budget proposing the abolition of angel tax for all classes of investors. The Congress manifesto had said: “We will eliminate ‘angel tax’ and all other exploitative tax schemes that inhibit investment.”

The party saw Sitharaman’s announcement that the Central government will set up a critical mineral mission as a reflection of its manifesto promise too. The Congress manifesto had promised to “launch a strategic mining programme to explore and mine rare earths and critical minerals, with the object of increasing the share of mining to 5 per cent of the GDP and creating 1.5 crore jobs”.

At a press conference held by the party after the Budget, senior Congress leader P Chidambaram identified unemployment as “the biggest challenge facing the country” and dubbed the government’s response as “too little”. Accusing the BJP of yielding to allies TDP and JD(U), he said: “Mr Modi is saving the life of his government.”

Talking about the “parallels” between the manifesto and Budget, Chidambaram said: “I wish she (Sitharaman) had adopted many more ideas from the Congress’s manifesto.”

Surprisingly, the Budget was largely silent on poll-bound Maharashtra, Haryana and Jharkhand, despite how crucial these Assembly elections – the first after the Lok Sabha polls – are for the party.

With the Opposition showing a revival in their states, BJP leaders from Maharashtra and Haryana did not hide their disappointment over the Budget.

A BJP leader feared that the Opposition Maha Vikas Aghadi (MVA) may use this to target the party. The hope among some quarters that Uddhav Thackeray of the Sena (UBT) could be wooed away from the MVA seems an unlikely dream now.

At least two alliance leaders also talked about the Budget being “disappointing” and leaving them in an “embarrassing” position.

Officially though, Maharashtra CM Eknath Shinde of the Shiv Sena and LJP first-time MP Shambavi Choudhary hailed the Budget. The government had “heard the voices of Bihar and Andhra Pradesh on special category status”, she said.

CPI(M) MP John Brittas said that even in putting Andhra and Bihar front and centre, the Budget had failed to address their concerns with any finesse. “All of a sudden, eastern corridors have been redrawn to stretch them to Andhra Pradesh since power in Delhi runs through there.”