Peeking into the immediate neighbourhood – Pakistan, Bangladesh, Sri Lanka — one is relieved to have avoided the plunge over the cliff. After seven years, Ursula K. Le Guin’s words ring true “There is a certain bleakness in finding hope where one expected certainty.” Within the constrained fiscal circumstances, having expended its political capital, with looming state and parliamentary elections, the Union budget was only expected to be populist laying the groundwork for a re-election. It does far more.
In layman’s terms, how do budget allocations impact farmers? Indian farmers pay ₹266.50 per bag of urea with the subsidy per bag at ₹2,317. For DAP they pay ₹1,350 per bag with a subsidy component of ₹2,500. Farmers generally use five bags of urea and two and a half bags of DAP per acre for a wheat-paddy crop rotation. Therefore, for each acre, such farmers are subsidised by ₹17,840 per acre. The Pakistani brethren pay 2.5 times what Indian farmers pay per acre. The BJP IT cell could have saturated the conversation with such positive narrative, but the IT cell was busy creating ghosts and has resulted in the FM being compelled to make compromises.
Yet, it is meaningful to ask if India is going wrong, completely wrong somewhere. On my field trips across India, I ask farmers and landless workers, “if 75 years of budgets, agriculture policies, support and subsidies have empowered them to lead a life of dignity”. The answer is always a vehement ‘no’. This notwithstanding, governments providing humongous sums (over ₹8 lakh crores) under PM Kisan, free electricity, subsidised fertiliser and minimum support price procurement and such others. It is not that India has not progressed or these subsidies have not helped but, after 75 years, something is still seriously amiss. The answer, which curiously even farmers seem unconscious about is that most subsidies are only a ‘pass-through’ to consumers and cash transfers are simplistic reactions to inherently complex issues.
There is another aspect of confusion when it comes to brickbats. The centre receives flak for lack of delivery of services and promises that are actually for the states to perform; which are within the ambit of the states. At the state level, the capacity to spend resources rationally, to scale up and execute programmes remains abysmally low. One simply cannot, thus, forecast the future by pouring over the union budget in isolation from the action at the state level, where, conscious incompetence perpetually assesses every initiative with a lens to win elections like a festering scab. Ideas like the ‘old pension scheme’ and ‘free electricity’ can only hasten bankruptcy in such states. The other worry is the blooming national debt — union and state — that the Budget fails to stem. In fact, India’s debt is growing faster than the economy as a whole.
Over the years, making budgetary allocations on the premise that quality of life can be equated with consumption has been proven fundamentally wrong. Long ago, the idea became conventional wisdom and is seldom questioned. This budget makes a mention of these objectives. Allocations for 11.7 crore household toilets under Swachh Bharat Mission and enhancing the outlay for PM Awas Yojana by 66 per cent to ₹79,000 crore is appreciable. As a farmer, one is excited about the Atmanirbhar Horticulture Clean Plant Programme to boost the availability of disease-free, quality planting material with an outlay of ₹2,200 crore. The budget is a heroic effort but considering the size of the sector, the allocations are miniscule, even for programs to incentivise natural farming, using animal manure, alternative fertilizers etc.
Contrary to expectations, the FM’s decided not to increase the quantum and ambit of PM Kisan to farm labourers. In a crisp budget speech, the FM mentioned Lab Grown Diamonds and one nearly fainted for it initially registered as incentivising Lab-Grown Meat. The bigger worry is about the employment front. The government has failed in filling government job vacancies and generating employment. Nor do I foresee the creation of mass employment fast enough or raising of incomes, except for government employees.
Of note is the Pradhan Mantri Kaushal Vikas Yojana 4.0 to skill lakhs of youth within the next three years brings to mind Lao Tsu’s words, “The truth is not always beautiful, nor beautiful words the truth”. The word ‘green’ & ‘energy’ are spoken umpteen times in the budget speech and drives the fear that the funds will be spent on industrial-scale projects for converting food to fuel; a horrifying proposition. Green Mobility is better achieved by incentivising electric tractors, charged with on-field solar panels, giving farmers a choice of being off-the-grid or with net-metering facility. Missing in action is ground-up out-of-the-box thinking.
For those wondering if the budget will move the needle one way or another, one can only advise a potion of blind faith. The decade is still not lost. As a farmer, one is an optimist, as farmers usually are. Despite all the reasons for pessimism, there is hope that the worst is behind us, though unequally so and truth to tell, one does not really know what lies ahead. The economic reality is catching up with the regime and it is time the lion lost sleep over the opinion of the sheep.