If This is ‘Pro-Farmer’ What Will an Anti-Farmer budget look like?

Captains of industry at a FICCI budget-watching session in New Delhi: Photo Courtesy 'Outlook'

Someone’s income will surely double by 2022. But, contrary to the crazy claim, it won’t be the farmer but India’s new dollar billionaires.

So that’s it, then. From this year, there will no more be a ‘Statement of Revenue Foregone’ in the Union budget. There is indeed Rs 5,51,000 crore written off in corporate income tax, excise and customs duties. As always, mainly to the benefit of the rich. That’s even higher than last year’s Rs 5,00,823 crore in these same giveaways. But you are no longer allowed to say this is revenue foregone. Call it that and this government could actually dub you an anti-national. The word ‘foregone’, the regime’s little spin-doctors found, was damaging. It gave the game away by revealing huge corporate freebies to the public. So with this budget, ‘foregone’ is forever gone. We now have ‘The Statement of Revenue Impact of Tax Incentives under the Central Tax System’.

Gee! That sounds more sophisticated. But it’s still the same thing. The corporate karza maafi continues. The amo­unts are higher. And the total since 2005-06 is well over Rs 42 trillion. A stench by any other name smells just the same.

The revenue ‘impact’ in terms of direct corporate income tax write-offs, for instance, is Rs 68,711 crore. That’s Rs 3,644 crore more than it was last year. Not much less than the ‘massive increase’ in NREGA (Rs 3,801 crore). The latter involves the survival of millions, the former of a few corporations. This direct corporate income tax write-off is also 91 per cent higher than the Rs 35,984 crore given to ‘agriculture and farmers’ welfare’.

The government falsely claims that the Rs 38,500 crore given to NREGA in this budget is the highest ever. Truth: the allocation was roughly Rs 40,000 crore in 2006 when it was, in fact, a smaller programme. It kept close to that for a while, before P. Chidambaram worked hard at undermining it. The ‘increase’ shrinks pretty fast if you adjust it for inflation. Also, in a year when even the government speaks of high rural distress, an upward blip in spending is natural. Even in Maharashtra with its wretched NREGA performance, more and more people are seeking work under the programme. In any case, over Rs 6,000 crore of this ‘record’ sum will go in meeting pending liabilities.

Alongside this fiddle comes the crazy claim of doubling farmers’ incomes by 2022. Does the finance minister mean real income after adjusting for price rise? And how? At the heart of their crisis is how unviable farming is being rendered—by policy. Will he honour his party’s promise and boost the MSP? Will he reduce the burden of farmers locked into a high-cost econ­omy—give them access to better credit and cheaper seed, fertiliser and other inputs? There is not a hint in the budget. The lion’s share of ‘agricultural credit’ goes to urban and metro-based businesses. And the promised irrigated land—will that be done by renovation of tank systems and the like (that can be linked to the NREGA)? Or through the river-linking delusions that pro­­mise a giant bonanza for contractors but little irrigation?

Yet, dozens of anchors and editorials blather on about this being a pro-farmer, pro-rural budget. As they have every second or third year for two decades. ‘Pro-farmer’ budget should ring a warning bell. It is usually followed by further handing over of agriculture to agri-business. And terrible times for farmers. Somebody’s incomes will indeed double by 2022. It won’t be the farmers, betrayed on the increased MSP that the BJP promised them in its 2014 poll campaign. It could be India’s 111 dollar billionaires listed in the latest Hurun report. Their wealth grew by 25 per cent in a single year, the report says. And of 99 new dollar billionaires across the world added to the list since last year, 27, or nearly a third, are Indians.

The combined wealth of these 111 rose by $62 billion in 12 months to arrive at $308 billion in Hurun’s reckoning. Now, if just that increase was taxed at 30 per cent (which would be standard practice in Europe), it would come to a bit over $18 billion. Or about Rs 1,22,774 crore. Still less than a fourth of the ‘impact’ write-offs for the better-off this year. But enough to exp­and the rural employment programme by more than threefold in a year of great distress.

Gold, diamonds and jewellery write-offs are Rs 61,126 crore. That’s 58 per cent more than the greatest allocation ‘ever’ for the NREGA. And nearly 70 per cent higher than the sum for ‘agriculture and farmers’ welfare’. Since 2005-06, the amount written off as duties on gold, diamonds and jewellery comes to over 4.6 trillion rupees. More than 13 times this year’s allocation for ‘agriculture and farmers’ welfare’. If this is a pro-farmer budget, you’d hate to see what they call an anti-farmer one.
 
And remember these are not billed as ‘subsidies’, though that is very much what they are. When the government attacks ‘subsidies’, those are the ones going mainly to the poor. Food, employment, health and more. Those shilling for such a heartless assault call these “wasteful subsidies”. The ‘revenue impact’ rubbish they call “incentives”. Subsidies are what you give the poor. What they’re trying is to replace universal systems with ‘targeting’, which excludes tens of millions in need. On the other hand, ‘impact’ subsidies (aka Godzilla write-offs), those keep rising each year. The total revenue ‘impact’ write-offs this year are 140 per cent higher than revenue forgone in 2005-06, the first year for which such data is available.

In the total amount foregone to the better-off under corporate income tax, excise and customs duty since 2005-06, you could run the NREGA for about 109 years on present levels. You could transform tens of millions of lives for the better. Dropping ‘foregone’ and hiding behind the fig leaf of ‘revenue impact’ adds more than insult to injury. (In the first place, it ought to have been ‘forgone’ and not ‘foregone’. But that’s another story).It introduces a Kafkaesque idiocy to the process. Decades ago, when the US military needed to make its many wars more acceptable, or at least less shocking, they came up with the words “collateral damage”. A euphemism for countless thousands of civilians they killed in their wars. The slaughter continued, but sounded so much nicer. The authors of the budget’s sleazy semantics do something similar in their wordplay. The loot of public money, where it’s going, and the intense misery of millions in need—that drowns in collateral cliches.

The writer is a Rural Reporter and founder of People's Archive of Rural India.