Editorial 1st Quarter 2018

          FIRE   MAGAZINE  EDITORIAL  FEBRUARY  2018                                                              

 

                                              

                                                       THOTA  HANUMAIAH

                                                            CHIEF    EDITOR                                                                                                                                                       

 

                                    UNION       BUDGET       2018-19

 

This Union Budget 2018-19 is reflective of the central government’s clear commitment to serve the interests of foreign and domestic big corporates, while mounting further burdens on the vast majority of the working people of our country. 

In spite of the fact that the top one per cent of the Indian population amassed 73 per cent of the additional wealth generated in 2017, the budget does not increase the direct taxes applicable to the rich. On the other hand, the government, increasingly, relying on indirect taxes for its expenditures, which is causing a blow to the common people. The fact is that, the proportion of the direct taxes in gross central taxes budgeted is to come down from 51.6 per cent to 50.6 per cent, which is favourable to the rich, at the cost of poor. 

The budget was deceptively articulated as pro-poor by projecting massive expenditures on agriculture, rural development and national health care scheme of medical coverage of 10 crore households up to Rs. 5 lakhs per year.  The health care scheme is a reshuffling of the existing one and no additional allocations have been budgeted.  It is clear that this scheme will also be used to give benefits to insurance companies.  Experiences have shown that health or crop insurance schemes have resulted in a profit bonanza for corporates rather than benefits to the people.

 

This government has presented the budget leading to contraction of economy. This means that there will be further reduction of employment opportunities and social welfare expenditures.  The government expenditure to GDP has now reduced further, from 13.2 per cent to 13 per cent. Last year, the levels of capital expenditure on central social schemes were below the budgeted targets, meaning a cut to meet the fiscal deficit target, by reducing expenditures meant for people’s welfare.  That the growth of tax revenue collection is indicating to be below the targets, the government has reduced its expenditures directly affecting adversely the people’s livelihood.  The expenditure on agriculture and  rural  development, as percentage of GDP, is reduced from 1.15 per cent to 1.08 per cent;  the total health expenditure has fallen from 0.32 per cent of the GDP to 0.29 per cent;  Central expenditure on education has fallen from 0.49 per cent of the GDP to 0.45 per cent;  the gender budget has fallen from 0.68 per cent to 0.65 per cent of GDP;  allocations for welfare of STs is below 1.6 per cent of the total budget and for SCs, it is 2.32 per cent.   This is totally inadequate, seen, in proportion to the share in population.  The allocation for MNREGA has remained unchanged and Rs. 4,800 crores owed to state governments from 2017-18 are still to be released.

 The government, yet, promises to declare a minimum support price at least one and a half times the production costs.  The Finance Minister misled the country that the government had already declared such an MSP for a majority of Rabi crops.  This has never been seen in implementation across the country.  Similarly, other claims of extended crop loan facility etc are not realised in budgetary allocations.  The allocation for food subsidy and procurement of crops is grossly inadequate to provide either support to the farmers or to the commitments under the Food Security Act.  There is no mention of a loan waiver for the farmers groaning under debt burden and have been pushed to commit distress suicides.

The middle classes have seen no direct benefit. The employees see a reduction in the earnings on their savings.  Even the so-called relief of Rs. 2 per liter of petrol and diesel is offset by increasing the cess from Rs. 6 to 8 per liter. This is an anti progress budget subjecting the people to miseries on top of the miseries imposed by the acts of Demonetization and Goods and Services Tax. 

In sum and substance, this budget is a typical propaganda oriented exercise, meticulously articulated by the NDA government to misguide, confuse and deceive the people.  This budget, while actually, reduces the public expenditures, it is at the same time disinvests public sector to reduce the fiscal deficit to appease international finance at the expense of imposing greater burdens on the Indian people. This is an anti-people Budget by any standards.

 

                                                                                                                   Thota Hanumaiah.