Budget 2022-23

AS is expected, the union government budget for 2022 has been hailed by the government and run down by the opposition. This year’s budget is significant as it comes just ahead of the polls in the five states including the all-important one in Uttar Pradesh. So, the government was mindful about sending the right message to the electorate across the poll-going states. The outcome in these elections will to a good extent determine the future of this government, more so when general elections are just two years away. And the finance minister Nirmala Sitharaman did her best to live up to the diverse expectations and try to keep all sections of people happy. Whether she has succeeded or failed in this will be a distinct factor in the outcome of the polls.

However, as was evident from the budget, the government stayed short of increasing cash transfers to farmers under PM-Kisan from the current Rs 6,000 per year, or by providing income tax relief to the middle class. The outlay on MGNREGA has also been slashed to Rs 73,000 crore, from Rs 1,11,700 crore in 2020-21 and Rs 98,000 crore in revised estimates for 2021-22.

As for other salient features of the budget, the government has projected GDP growth at 8% to 8.5% compared with an estimated 9.2% for the current fiscal year and a 6.6% contraction the previous year. Sitharaman unveiled a ₹39.45 trillion budget which focussed on stepping up investment on highways and offer affordable housing to people. The government also raised government capital expenditure by 35.4 percent to Rs 7.5 trillion and increased orders for local defense companies, something that is seen as a boon for the India Inc. Domestic defence industry got a boost with the finance minister announcing that 68 percent of the capital procurement budget will be earmarked for domestic industry in 2022-23, up from 58 percent in 2021-22. Significantly, Sitharaman also announced a new scheme to build infrastructure in villages along China border.

Prime Minister Narendra Modi later in his reaction to the budget mentioned that developing infrastructure in sparsely populated villages along the LAC was also necessary for the country’s security.

PM Modi lauded the budget as a step towards a modern, self-reliant India with its focus on providing basic amenities to the poor, middle class and youth. The PM also said the budget proposes to make a four-fold increase in public investments as compared to those in the UPA regime. The opposition, meanwhile has slammed the budget as anti-poor. Congress leader Rahul Gandhi described the Union Budget for 2022-23 as a "zero-sum budget", saying it has nothing for the salaried, middle class and the poor. However, the budget’s biggest test will be the outcome of the upcoming polls. That alone will show whether the proposals have resonated with people or not.

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