The Balancing Act

The Finance Minister has walked the tightrope with a budget that is more prudent than populist.

- Rohan Bhandare

The Budget is not just a provisional income and expense statement, but a roadmap of the economy. And, as with any map, it is imperative to follow all the routes leading and converging into ‘New India’. The last year has seen a slew of reforms in terms of the Real Estate Regulation and Development Act (RERA), the Insolvency and Bankruptcy Code and the Goods and Service Tax Act. The anti-tax avoidance measures as well as formalisation of the economy through demonetisation undertaken by the Government have borne fruit and the direct tax collections have shown a robust double-digit growth. With the Economic Survey hinting at a challenging fiscal situation and farmer stress, and given that Budget 2018 was the last full-term budget, the Finance Minister has found himself at the crossroads of populism and prudence. With this in mind, the focus of this Budget has been on strengthening the core foundation of the agricultural sector, rural economy, healthcare and infrastructure.

Agriculture & Rural Development 

Learning from its experience in the Gujarat elections, and keeping an eye on the major poll-bound states, the Finance Minister has given centerstage to the rural and farm sector. The Finance Minister has promised to deliver Minimum Support Price (MSP) with the objective that the farmers should realise at least 50% more than the cost of produce. This exercise will require a lot of number-crunching and hopefully the successful implementation will result in more disposable income for farmers. The other initiatives such as support to organic farming, doubling the expenditure allocation for food processing sector, Operation Green, developing Grameen Agricultural Markets (GrAMs) and liberalisation of agricultural exports should provide a stable environment for farmers.

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