Missing the Big Picture

BUDGET 2020 PLAYS IT TOO SAFE. THERE ARE NO NASTY SURPRISES, BUT NOR IS THERE A CREDIBLE ROADMAP TO ECONOMIC RECOVERY

- SHWWETA PUNJ & M.G. ARUN

THERE IS SOMETHING unique about the budgets presented by the Modi government’s finance ministers. They are mainly expressions of long-term intent, as opposed to policy statements with a bearing on the near-term prospects of individuals or businesses. The government’s record shows that major policy changes—such as implementation of the GST, the new Insolvency and Bankruptcy Code or the corporate tax cuts—will not come on high-visibility occasions such as budget day. In that sense, aside from the alternative income tax regime—which, on the face of it, puts more money in the hands of an upwardly mobile middle class (annual income below Rs 15 lakh) —Budget 2020 was something of a non-event. To be sure, some sectors got attention. For instance, finance minister

Nirmala Sitharaman outlined 16 measures for the agriculture sector, reiterating the government’s aim of “doubling farmers’ incomes by 2022”. However, as agriculture economist Ashok Gulati puts it: “That requires an almost 15 per cent per annum growth in their real incomes over the next three years. Can this even be achieved? I wonder at the lack of understanding of the issues and the challenges involved.” (See BITE, page 44.)