The strategy behind the budget lies embedded in its fine details

Indias deficit targets have won praise but the deft re-ordering of spending needed to achieve that has escaped public scrutiny

- RAJRISHI SINGHAL

Most significant government documents have an underlying strategy. The budget document is usually an amalgam of political, economic, social and fiscal strategies, the different imperatives calibrated according to the needs of the day. In an election year, there is usually a marked emphasis on political and social objectives. The interim budget presented by finance minister Nirmala Sitharaman embodies a strategy that attempts to focus on political and social objectives even while demonstrating uncompromising fiscal discipline.

The finance minister, as part of a government preparing for imminent elections, had multiple and conflicting objectives. The document had to set itself up as a pre-poll document, which it achieves by tooting a horn on past achievements.

But the challenge lay in satisfying fiscal hawks while simultaneously pressing the accelerator on distributive justice. By targeting the 2024-25 fiscal deficit at 5.1% of gross domestic product (GDP), the budget not only makes Indian capital markets more acceptable to foreign investors, but also placates domestic fiscal hardliners who have an inordinately larger share of voice. At the same time, it deftly re-allocates social sector outlays between expenditure heads to areas that need immediate funding, thereby satisfying the electoral imperative.