KERALA BUDGET: TEARS AND JOY

Overall, in terms of modern economics, a budget is a political document which notifies the strategy of a government in the means of economics.

- Nandakumar Kadappal

Kerala budget for the fiscal of 2020-2021 tabled by Dr. T.M. Thomas Issac, the celebrated Marxist Economist turned finance minister of the state, coins a counter approach to the Neo-Liberal approch. We understand that the budget for the year 2020-2021 presented by Dr. Issac absolutely as a new edition of the renowned Kerala Model.

“The Budget presents an appealing and rewarding list of schemes and projects backed up by robust measures of revenue mobilization. With maneuverable fiscal space of states fast shrinking, expenditure rationalization from top to bottom non-tax revenue collections needs to be ruthlessly taped. Resourceful Kerala need not behave like a beggar sitting on a bench of gold, especially because it has to forge ahead for a new model.” Mr. M.A. Oommen, Former Chairman of State Finance Commission writes (The Hindu/08 February 2020). Economists and financial experts are very much interested on the Dr. Issacs new approach. Analysts, playing political cards have nothing to highlight, but they have something political elements there, is quite natural.

Dr. Issac’s main focus is to protect the existing social achievements at its best. He is also on the move to gain goals in Industrial and Agricultural sector. He is not ready to cut short the developmental and welfare expenditures. The overall focus of budget is to strengthen the economy and fiscal position of the state. Hence, he is working on to mobilize the non-tax revenue in the tune of Rs 1103 Crores extra in the coming financial year. This is to enhance the pattern of the existing welfare pensions and other developmental activities. He earmarks Rs. 200 crores to the A-double Plus NBFI of the state, the KFC to provide sufficient credit support to the new entrepreneurs in connection with the state’s efforts for the mobilization of small and medium level industries.