#dnaEdit: Neo-populist tenor

Friends of Bharatiya Janata Party (BJP) wanted Finance Minister Arun Jaitley’s first full-fledged Budget to have a clear, bold and loud reforms agenda. Critics of the BJP and of the BJP-led NDA government argued that Jaitley would ignore the poor and the marginalised, that it would be a business-friendly, and more specifically corporate-friendly, budget. Jaitley disappointed friends and critics. The refrain in the Budget, and it was a political one, was about the reduction and elimination of poverty. 

As part of this overall thrust, the finance minister laid much emphasis on the previous UPA government’s Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), and he has even increased the allocation for it. He had acknowledged that it is one of the ways of fighting rural unemployment and of combating poverty. This follows Prime Minister Narendra Modi’s assurance in the Lok Sabha on Friday that MGNREGA would be continued. While assuring that there is no move to do away with subsidies, he entered the caveat that subsidies will have to have a “well-targeted system of subsidy delivery”. He however took care to add “We need to cut subsidy leakages, not subsidies themselves.” The phrase “poverty elimination” occurred several times in the Budget speech. The rhetorical formulation came in the sentence: “Madam, Speaker, this government is committed in its resolve, as Indians, to regain our pre-eminence as a just and compassionate country.” Here is a clear attempt to show that this government wants to build a caring society.

The announcement of wanting to create universal social security and a pension option for elderly people below the poverty line, especially in the rural areas through the Atal Pension Yojana, reflects the government’s political sensitivity. There was the acute observation in the Budget speech: “Worryingly, as our young population ages, it is also going to be pension-less.” The government seems to be aware that the concept of welfare has to be expanded to take care of the future needs of the vulnerable sections. The Budget has also provided for the Scheduled Castes, Scheduled Tribes and for women, pressing all the right political buttons. Creation of jobs is another key theme. Government’s emphasis is shifting towards encouraging start-ups and giving a stimulus to entrepreneurship. 

There is then a battle between the BJP on the one hand and the rest of the Opposition on the other as to who will win the hearts of the poor. The Congress, the communists and the other socialist parties believe that the poor belong to their constituency. The BJP wants to break that monopoly, and it has displayed enough enthusiasm for welfare schemes. The general assumption had been that the Modi government would shelve, prune and even drop many of the welfare schemes, meant for SCs, STs, women and the minorities.  Jaitley makes it a point to observe that despite the “constraints on Union finances” the welfare scheme allocations for the special segments  will not be cut. At the end of the speech, Jaitley ended his speech on the idealistic note: “Our commitment to the “Daridra Narayan” remains steadfast, as is commitment to the Constitutional principles of Equality and Justice for All  without concern for caste, creed or religion.” This might be criticised as nothing more than political rhetoric, but the finance minister felt the need to state the general principles as a way to reinforce the BJP’s political credibility. Budget is not just an annual statement about public finance. It is a reiteration of political creed as well.