Vol. XLII No. 06 February 11, 2018

Union Budget Anti-People and Deceptive

VARIOUS mass and class organisations have denounced the union budget for 2018-19, placed in parliament by finance minister Arun Jaitley on February 1, as “anti-people, anti-worker and deceptive”. In the last full budget of the NDA government before the 2019 general elections, the finance minister resorted to lies and deceit through high rhetoric and overestimated projections.


The Union Budget turned out to be a deceptive one, meticulously articulated to misguide and confuse the people. The budget is anti-worker, anti-people and also militates against the national interest. The CITU condemns such an anti-people exercise.The budget remained liberal about extending concession to business houses. On the plea of supporting micro, small and medium scale enterprises (MSMEs), it extended a reduced corporate tax rate of 25 per cent to companies having Rs 250 crore annual turnover. Through such deceptive manner the burden on corporate houses has been reduced further by Rs 7,000 crore while giving no relief to suffering millions reeling under post-GST indirect tax burden. This, along with other pro-corporate policy drives, continued to remain the pattern of budget exercise of the Modi government, pushing the entire country in the midst of extreme and obscene income inequality whereby one per cent of the people is cornering 73 per cent of the national wealth. And yet, the government continues to call itself pro-poor.

While speaking lavishly about improving health, education and social welfare services toward universalisation, it remained totally negative in considering the long-standing demands of about one crore workers working in its flagship schemes of NHM, Mid-day Meal (MDM) and ICDS. In fact, the allocation under National Health Mission (NHM) has been reduced and there is marginal increase for ICDS and MDM that too for other expenditures. On employment generation also, the claim made in the budget speech is not true. In fact, even as per official estimates, the net employment generation has turned negative in absolute terms if job-losses owing to closure of factories/establishments during the period is taken into account. The claim of creation of 70 lakh jobs in the formal sector, said to be based on the increase in the number of EPFO data, is another hoax to confuse and misguide the people and a cruel joke on the millions of unemployed.

The budget speech has gone extremely lavish in pronouncing commitments for development of agriculture and rural development along with launching of so many schemes, whereas budgetary allocation for 2018-19 both on account of agriculture and allied services and rural development marked a marginal increase of Rs 9,793 crore in nominal term, meaning actually a decline both in real terms and also as a percentage of GDP and total budgetary allocations.

Similarly, the budgetary statement about putting in place under its flagship programme of National Health Protection Scheme to provide for secondary and tertiary care hospitalisation at the rate of Rs 5 lakh per family per year to 10 crore poor and vulnerable families, if weighed in terms of actual budgetary allocations, turns out be another hoax. The budgetary allocation on this account is merely Rs 1,600 core which can cover hardly 10 lakh families (and not 10 crore). And such discrepancy exposes the dubious intent.Overall, behind the shrill fraudulent noise of all-round development, the budget continued to remain a contractionary budget and focus of almost all government expenditures are designed to benefit only the rich and propertied business class and the common people and the workers in particular are being subjected to deeper exploitation and repression.

The budget speech lavishly spoke about developing self-reliance in defence production and what is being actually done is setting the process of destruction ofthe existing indigenous manufacturing capabilities in the ordnance factories, the defence PSUs and the country’s shipyards by way of mass-scale outsourcing in favour of private sector, both foreign and domestic. On the same way, under the camouflage of expanding railway network, the project of total privatisation of the railways is being pursued in full swing.  Are these in any manner serving national interests or sabotaging the same in favour of foreign players? The government has been moving fast in selling out the national assets through wholesale privatisation. In the current year, the target for disinvestment /privatisation is kept at Rs 80,000 crore to keep on the pace of its “Destroy India” programme under the camouflage of “Make in India”.


The finance minister resorted to lies and deceit to betray farmers who have been reeling under acute agrarian crisis in his last full budget before the 2019 general elections. After having promoted corporate loot and crony capitalism in the name of “ease of doing business”, he is seeking to hoodwink the peasantry, working class, poor and the middle class by claiming that the BJP-led NDA government has moved to “ease of living” for them. The budget which has come at a time when massive farmers’ protests have demanded remunerative prices and liberation from debt has failed to address these issues.

First and foremost, the betrayal is on the demand of the peasantry for assured remunerative prices. After having reneged on Narendra Modi’s pre-poll promise of providing MSP according to the recommendations of the National Commission of Farmers which had recommended MSP at least 50 percent above the cost of production (C2), the finance minister now claims that they have already implemented the recommendations for the Rabi season and claims that for the next Kharif, MSP will be given at the rate of 150 percent above cost of production. This is a blatant misrepresentation of facts as shown in the table below for the latest MSP announced for Rabi, 2018-19. Even if we take the Finance Minister’s announcement at face value there are no allocations for meeting the expenses and for ensuring payment of deficit in price to farmers in the event of them receiving prices below MSP.


Rabi 2018-19 Projected Cost of Production C2, C2+50 and MSP Announced (in Rs)


C2 (Cost of Production)





















Rapeseed and Mustard









Also, it is to be noted that the C2 calculations itself are disputed and farmers’ organisations have been calling for correct cost calculations. The weighted average cost of production taken into consideration by the Commission on Agricultural Costs and Prices also disregards the state government cost calculations. Over and above that the MSP announced for most crops is only notional as there is no procurement mechanism in most parts of the country. So, without having a procurement mechanism in place there is no assurance of the announced MSP accruing to farmers. Nothing has been done in this direction.

Secondly, the BJP-led government has betrayed the farming community and rural poor by refusing to announce any policy for liberation from indebtedness for the peasantry.Thirdly, the agricultural workers and rural poor who have seen falling incomes and increasing migration have nothing in the budget for them. No increase in MGNREGA allocation has been made. Rs 55,000 crore allotted is equal to the revised estimate for 2017-18. Even by conservative estimates, more than Rs 80,000 crore will be required for proper implementation of the programme. This callous attitude is despite the fact that over 56 percent of wages were pending and more than 15 percent of the wage-seekers did not find any work in 2016-17. The budgetary proposals for agriculture are aimed at helping the corporate agri-businesses and have no vision for promoting farmers’ welfare. The budget fails to deliver on the demands of the farmers, agricultural workers and the poor.


The All India Democratic Women’s Association (AIDWA) expresses its disappointment with the anti-people budget. It is based on high rhetoric and overestimated projections of growth revenue. Coming right after the introduction of GST, the government refuses to acknowledge the ground reality and overestimates the GDP growth at a nominal rate of 11.5 per cent and a real growth rate of 7-7.5 per cent. Even by these overestimated standards, the size of the total budgetary spending by the government has come down. This in itself shows that the present regime is not serious about implementing any of its “grand pronouncements”. In line with this, the size of the gender budget has also contracted, despite the finance minister’s statement that ‘agriculture and rural sector’ and ‘women’s employment and health’ were some of the main priorities of this year’s budget.

The government has shown total insensitivity towards the needs of women. The total gender budget has declined from 0.69 per cent of the revised GDP for 2017-18 to 0.65 per cent of the projected GDP for 2018-19. There has also been a decline from 5.2 per cent to 4.9 per cent in terms of the proportion of the gender budget to the total budgetary expenditure between 2017-18 (revised estimates) and the proposed budget for 2018-2019. As far as the allocations for the ministry of women and child development are concerned, it has been increased from 0.95 per cent of the total expenditure in the revised estimates of 2017-18 to 1.0 per cent of the total projected expenditure for 2018-19.The implications for women are particularly alarming. This is nothing but an insult to the poor women workers and farmers of the country.

Though the budget speech focused on the plight of the women farmers, the gender specific allocation for women farmers is only 3.92 per cent of the entire gender budget (that is an increase of a paltry 0.63 per cent in one year). The real agenda of the government is, however, revealed in the 22,000 Gramin Haats that it proposes to set up so that ‘farmers can directly sell to the buyers’. The budget also projects that this will be facilitated through farmers’ producer firms and women’s self-help groups. This huge challenge is to be met by an overall paltry increase of Rs 1,400 crore in the National Rural Livelihood Mission of which the women’s share is 50 per cent. It is clear that this is merely an initial sum being put forward by the government in order to facilitate corporate investments in agriculture. Hence, instead of helping the farmers to overcome the agrarian crisis, this budget seeks to link women with global agricultural value chains which may lead to further exploitation.

Secondly, the finance minister has claimed that this budget will increase employment, especially for women. Even the Economic Survey 2017-18 has posited that there has been a drastic decrease in women’s employment in the last few years. In order to boost employment, the government is banking on skill development, increase in self-employment, support to medium and small enterprises, and the use of MNREGA for building infrastructure. Once again none of these claims are backed by adequate allocations.As far as education is concerned, the proportion of expenditure in this sector has come down from 2.1 per cent to 2.0 per cent of the total expenditure. In this context, it is also important to note that the allocations for educational schemes for girl child have decreased by Rs 64.1 crore. There has been a paltry increase of Rs 80 crore in the flagship ‘Beti Bachao, Beti Padhao’ Scheme. Though the government claims to be pro-women, there is virtually no mention of measures to address the rising violence against women. The Nirbhaya Fund remains at Rs 500 crore.


The union budget comes as a big disappointment to the disabled community in the country. It seems as though the disabled do not figure in the finance minister’s “fast growth economy” trajectory.The passage of the Rights of Persons with Disabilities Act 2016 (RPD Act) had ushered in great hopes and expectations among the disabled community who continue to be on the margins. However, the miserly outlays for the various positive provisions contained in the Act point to the utter lack of sincerity on the part of the government to implement its provisions.The total outlay for the department for the empowerment of persons with disabilities shows a marginal increase of Rs215 crore as compared to last year. The allocation towards Schemes for the Implementation of the Persons with Disabilities Act (SIPDA) is a mere Rs 300 crore. This includes provision for the much touted “Accessible India” campaign under which the target set is for making 600 public buildings accessible, 600 official websites accessible and making transport systems accessible among others. It is another matter that the campaign excludes from its ambit the vast majority of the rural areas.

As for the railways, the last few budgets have seen grand announcements being made of rail transport and stations being made accessible for all including the disabled. Given the number of unfortunate incidents reported in the media, it was expected that the government would respond adequately.The finance minister has announced that escalators would be provided at 600 stations having a footfall of 25,000 and above. Is this in addition to the 500 announced in the last budget? The status of implementation of announcements made in the 2017-18 budget say that “430 escalators at 167 stations and 279 lifts at 122 stations have been provided”. Is the government claiming that all of these were installed during the last financial year? Also missing mention is about fulfilling the commitment made in the 2016-17 budget to provide accessible toilets at all railway stations. Further, no new scheme has been announced or any substantial increase in allocation for existing schemes been made despite the mandate of the RPD Act. There has been no upward revision in the amount of disability pension and it remains stagnant at Rs 300 for the past many years.

While the finance minister lauded the outcomes of various insurance schemes, and also announced the launching of the National Health Protection Scheme, ironically the central government has not been releasing money for the Swavlamban Health Insurance Scheme launched in 2015 for persons with disabilities through the New India Assurance Company Limited.The insurance company has now stopped collecting premium from beneficiaries. It is also disturbing that even while talking of health care the Finance Minister maintained complete silence on Mental Health. This despite the enactment of the Mental Health Care Act in 2017.It becomes abundantly clear that the disabled continued to be abjectly neglected and excluded from the “ease of living” which the finance minister so pompously talked about, the National Platform for the Rights of the Disabled (NPRD) said.


The budget of the NDA government reflects the character of its rule, a neatly laid out structure of vague promises and falsehoods. It clearly reflects the way in which its policies have driven the majority of the people of India into a web of poverty, indebtedness and despair.The budget reflects the fact that the BJP needs to pay attention to peasants, agricultural labour and craftsmen in the villages without paying them anything out of its pocket. The government allocated Rs 55,000 crore for MNREGA, when what is required is Rs 1,60,000 crore for any such effective programme. The schemes for housing loans, food security, education, health care and rural development are no more than a cover-up for privatising the economy further and escaping the responsibility of the government for delivering the goods, the All India Agricultural Workers Union (AIAWU) said.


The union budget for 2018-19 is, as usual. a document of commitment to serve the interests of the big corporates, both Indian and foreign, at the cost of the working class and other sections of the common and marginal people. While the tax exemption limitfor the salaried and other sections of the working people remains unchanged, corporate tax for the rich – 1 per cent of the population who have cornered 78 per cent of national wealth generated last year – has been slashed down by 5 per cent (from 30 per cent to 25 per cent).As a result, the share of direct taxes in the gross revenue income has come down to 50.6 per cent from 51.6 per cent last year, giving a further boost to income and wealth inequality in the year ahead. To compensate the tax-bonanza for the corporates, government expenditureon social welfare measures for the poor and common people has been slashed down from 13.2 per cent (last year) to13 per cent (this year) of GDP. A shrewd, rather somewhat cruel, window-dressing has been done by way of a national health care scheme of medical insurance coverage for 10 crore households.The fact remains that there is no additional allocation for the scheme.

The Bank Employees Federation of India (BEFI) is concerned, though not surprised a bit, that the finance minister has preferred conspicuous silence on the recovery ofhuge NPA (bad debts) from willful corporate defaulters while being most eloquent on disinvestment of PSUs, like a spoilt child selling family silver with abandon. He has set a target of Rs 80,000 crore for disinvestment of PSUs during the fiscal 2018-19.