The budget figures show that the revenue earnings of the government increased by 14.5 per cent while the expenditures grew only by 5.94 per cent. Instead of using these revenues for expanding economic activity, it has been used to reduce the fiscal deficit, to appease International Finance Capital, from 5.8 per cent to 4.9 per cent of the GDP.

The GDP calculations projected in the budget are yet another exercise in “data fudging” says the statement. Nominal GDP growth is projected at 10.5 per cent. Real GDP projected to grow 6.5 to 7 per cent is calculated by deflating the nominal growth by ‘core’ inflation rate of 3 per cent which excludes the high food inflation rate of 9.4 per cent, thus exaggerating real GDP growth.

Squeezing government expenditure further, subsides have been substantially cut. Fertilizer subsidy is cut by Rs. 24894 cores and food subsidy by Rs. 7082 crores. Expenditures on education, health and rural development as a percentage of GDP remain more or less unchanged. MGNREGS continues to be neglected further. Budgetary allocation is Rs.86,000 crores which was less than what was spent in FY ’23.  However, Rs.41,500 crores are already spent in the first four months of this Financial Year, leaving a mere Rs 44,500 crores for the remaining eight months. Clearly, this will be grossly inadequate to tackle the deep unemployment crisis in rural India.

In the name of addressing unemployment, the budget resorts to gimmickry. The
new scheme introduced as the Employment Linked Incentive offers a one-month
wage to new entrants in the formal sector earning less than Rs. 1 lakh. Eligible workers will receive a maximum of Rs. 5,000 in three monthly instalments. However, employers receive a benefit of Rs. 72,000 for each new employee hired with a monthly salary of up to Rs.1 lakh in 24 monthly instalments, for every additional job created in two years. This is yet another avenue of subsidising corporates in the name of generating new employment. Such gimmickry cannot generate employment. The huge profits made by corporate sector in the past have not resulted in investments in machinery and production due to persisting lack of demand in the economy which is the result of shrinking purchasing power among the people.

Budget 2024-2025 also highlights schemes to enhance skills among India’s youth. This
again is not going to solve the problem of high unemployment. During the period between 2016 and 2022 only 18 per cent of youth who attained training through skill promotion schemes got a placement. Once again, unless the economy expands job opportunities cannot grow.

Despite all talks of ‘cooperative federalism’, the state governments face a raw deal, apart from Andhra Pradesh and Bihar, under political compulsions. The survival of this ND Alliance government depends on the support of allies, particularly the Telugu Desam Party and Janata Dal (United).

However, the Finance Commission grants (apart from the tax devolution) to states has been reduced from Rs. 172760 crores in 2022-23 to Rs 140429 crores in 2023-24 and this budget reduced it further to Rs 132378 crores.

Overall, this budget is aimed at further enriching the rich and impoverishing the poor. It refused to consider any proposal of wealth or inheritance tax on the super-rich of India, neither any relief on indirect tax burden on people.

The Polit Bureau of the CPI(M) calls upon all Party units to protest against the failure of the budget to address the pressing issues of the people and the economy.

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“The Government of India has decided to extend the pension benefit to about three crore retail traders and small shopkeepers,” said Finance Minister Nirmala Sitharaman in her maiden budget speech in July 2019.

As she announced the name of the scheme, Pradhan Mantri Karam Yogi Maan Dhan, amid the celebratory thumping in the House, the camera panned to Prime Minister Narendra Modi whose government pledged to spend Rs 750 crore in the first year of the scheme that promised a monthly pension of Rs 3,000.

However, as the attention faded, the commitment too died. In its first year, the government spent only Rs 155.9 crore, leaving a staggering funding gap of Rs 594 crore.

Over the next three years, spending projections plummeted to inconsequential sums. In the previous fiscal, a trifling Rs 3 crore was allotted, of which a mere Rs 10 lakh was spent for the programme, according to the latest budget data. Over a period of five years since its launch, the government promised to spend Rs 1,133 crore but actually allotted a measly Rs 162 crore – just 14% of the promised amount. According to official data, the scheme had just over 50,000 takers till January 2023.

In March 2023, the Parliamentary Standing Committee asked the government why the pension scheme failed. The government said this pension scheme clashed with another scheme with a similar sounding name.

According to the government, people mixed up Pradhan Mantri Karam Yogi Maan Dhan with another pension scheme called Pradhan Mantri Shram Yogi Maan Dhan launched just four months ahead of it, a rare admission of lack of imagination in naming new pan-India projects while attempting to deflect questions on government failure.

Pradhan Mantri Shram Yogi Maan Dhan was to potentially cover 42 crore unorganised sector workers. But this pension scheme too had failed, documents show. It had covered only 43 lakh of the 42 crore potential beneficiaries in three years since its launch.

When the Parliamentary Standing Committee questioned the government, it passed part of the blame to a third pension scheme of an older vintage — Atal Pension Yojana launched in 2015 for unorganised sector workers. This scheme had already in its scope those being targeted by the two pension schemes that came after it.

The Atal Pension Yojana also has a dubious record. Independent research, and investigation by The Reporters’ Collective showed that banks were forcefully enrolling citizens in the Atal Pension Yojana without their permission. This sparked intense criticism that the government was artificially inflating the number of enrollments to falsely showcase the scheme’s success.

The government tasked a think tank to evaluate its pension schemes. The think tank, in its report, recommended discontinuing Shram Yogi Maan Dhan and merging it with Atal Pension Yojana. Additionally, the Ministry itself was mulling merging the shopkeepers’ pension scheme with the unorganised workers’ pension scheme.

The three pension schemes may have failed to varying degrees, but they symbolise Narendra Modi’s penchant for billboard governance – highly visible headline grabbing governance initiatives that’s propped up long enough to regale commoners’ memory but gets defunded once the white heat dies.

The Collective reviewed budgetary allocations to 906 central sector schemes that the Union government listed in its budgets over five years from FY 2019-2020 to FY 2023-24 to find out how much the Modi government spent on them. We found that the government underfunded 651 or 71.9% of the 906 schemes.

For one in every five schemes, the government spent half or lower than what it had promised.

Of all the budget cuts, the harshest cut was reserved for welfare schemes. At least 75% of the welfare schemes got less money than what the government had promised.

The next major area the government focused on cutting back funds promised in the budget were infrastructure schemes such as track renewals, roadways schemes, renewable energy grid. The government drew down fundings promised in the budget for nearly 73% of the infrastructure schemes in the total schemes reviewed.

Defence, industry and PSU-related schemes came third, fourth and fifth in terms of budget and spending mismatch. The Collective segregated schemes into these categories based on a general understanding since these are not officially defined terms. For many schemes, the categories may overlap.

When the government eviscerates welfare schemes and draws down infrastructure funds, how does it still manage to set the perception that it has been constantly innovating, crafting new policies and doing more?

One trick up the government’s sleeve is to rebrand, rename, repackage and rebuild existing schemes, some of them decades-old, with some tweaks.

For example, The Collective’s previous investigation had exposed how the government used the much-vaunted PM AASHA as a showhorse during elections. The government spent money on the AASHA scheme brought in to ensure minimum support price for pulses and oilseeds only around the 2019 and 2024 elections and not a single rupee in between. The scheme even made its way to the 2019 BJP Lok Sabha manifesto as one of the schemes responsible for doubling farmers’ incomes. The actual workhorse was an age-old direct procurement scheme from the UPA era that was dressed up as a new scheme under brand PM AASHA. By 2024 the BJP dropped the promise of doubling farmers’ incomes altogether from its manifesto.

While the majority of schemes fell short of promised allocations over the period of five years, the total actual expenditure of all 906 schemes is higher than the total budgeted estimates. Data shows there are two reasons for this: Firstly, government spending on Covid-related schemes was disproportionately higher than the budgeted estimates. This, however, does not absolve the government of poor spending since schemes remained underfunded before and after the pandemic.

Secondly, as reported previously, the government hiked spending on some welfare schemes in the run-up to the 2024 Lok Sabha elections after years of plummeting budgeted estimates.

Let’s look closely at central schemes that are funded entirely by the Union government and find out how they fared and whether the government spent as much as it said it would. We focused on the central sector schemes because the Union government is entirely responsible for their success or failure, unlike centrally sponsored schemes that are partly funded by the state governments.

Agriculture

Multiple schemes brought in to ensure doubling of farmers’ incomes, saw deep cuts and minimal spending compared with initial promises outlined in the budgets.

The Collective analysed one of these schemes, PM AASHA, in an earlier report. The crop price support scheme saw real spending only in the months around 2019 and 2024 Lok Sabha elections. Three years in between the two general elections, the government did not spend a single rupee on the scheme.

A second scheme, Pradhan Mantri Kisan Maan Dhan Yojana, is a small and marginal farmers’ pension scheme. Much like the Karam Yogi Maan Dhan and Shram Yogi Maan Dhan, this scheme too has seen poor enrolment. Since 2019, only 7.8% farmers have enrolled in the scheme that targeted 3 crore farmers. For all the years except FY 2023-24, the government spent less than what it had budgeted, data shows.

Worse, since the launch of a scheme for Formation and Promotion of 10,000 Farmer Producer Organisations in 2020, the government has spent far less than what it promised in all four years. The scheme aims to help farmers work together to up their bargaining power, reduce production cost, and make more money by selling their crops together.

Health

Around the time of the second deadly Covid-19 wave in 2021, the Union government announced the PM-Ayushman Bharat Health Infrastructure Mission, touted as India’s largest scheme for public health infrastructure since 2005. The scheme is run in partnership with the states, with some components run entirely by the Centre. To fulfil its end of the promise, the Union government planned to spend in 5 years over Rs 9,339 crore to set up, among other things, national institutions for critical care and strengthen disease research centres, but has only spent Rs 1,373 crore, or 14.7% of the planned amount even after 3 years.

Pension schemes

The government promised to spend Rs 750 crore on the PM Karam Yogi Maan Dhan, a pension scheme for small shopkeepers, in the first year of its inception in 2019. Two years later, reality emerged: The government had spent only 20.7% of the amount budgeted, with Rs 155.7 crore expenditure. Even in the latest financial year, the government claimed it would spend Rs 3 crore but spent only 3.3% of that.

In the government’s own words, multiple pension schemes clashed and undercut each other. For example, the PM Shram Yogi Maan Dhan, launched four months before the Karam Yogi Maan Dhan, saw the government spending just 58.6% of the amount promised in the latest fiscal. This is despite the Parliament Standing Committee on Labour pulling up the Ministry of Labour for slack coverage under the scheme.

Education

In its 2019 election manifesto, BJP promised Eklavya Model Residential Schools in blocks with over 50% Scheduled Tribes people. The school is meant to improve access to education for tribespeople’s children. The Ministry of Tribal Affairs aimed for 740 schools by 2025-26, achieving 54% of the target with 401 schools by December 2023.

Despite the slow pace, budget estimates didn’t see an uptick until the 2024 Lok Sabha election drew close. It promised to spend Rs 5,943 crore in 2023-2024 but has so far spent only 41.6% of the fund, despite criticism from the Parliament Standing Committee.

The Committee said it was “apprehensive” that the government will achieve the target by 2025-26 since it takes 2.5 years to build one such school. The committee noted the ministry didn’t utilise all the money it had.

Similarly, the government underfunded the National Fellowship for Scheduled Castes meant to provide opportunities for students from the Scheduled Castes to pursue higher education. The Parliament Standing Committee flagged it in December 2023.

Data shows actual spending on the fellowship has been decreasing. While the government spent only 68% of the amount promised in the budget in 2019-20, by 2021-22 it had come down to 40%. Even the number of fellowships awarded saw a 30% drop in 2022-23 compared with 2018-19 even after including previous year’s backlogs.

Rural Economy

In her maiden budget speech, Finance Minister Nirmala Sitharaman outlined how the government would help develop 75,000 skilled rural entrepreneurs in agro-rural industry sectors through a scheme called ASPIRE. Over the next four financial years, the government committed to cumulatively spend Rs 137 crore. However, it has spent only Rs 31 crore in this period, that’s just 22.7% of the promised amount.

Alongside ASPIRE, Sitharaman mentioned SFURTI, a scheme for upgrading traditional industries. Spending on SFURTI steadily rose until 2022-23, when the government aimed for Rs 334 crore but only spent Rs 1.95 crore. Similarly, the following fiscal year, the government spent Rs 2.5 crore against a budget estimate of Rs 280 crore.

Courtesy: The Reporters Collective

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Claim: In response to a query about perceptions of Muslim minorities in India at the Peterson Institute for International Economics (PIIE) in the USA, Finance Minister Nirmala Sitharaman denounced the claims of Muslims facing violence in the country, saying:

“India has the second-largest Muslim population in the world, and that population is only growing in numbers. If there is a perception, or if there’s in reality, their lives are difficult or made difficult with the support of the state, which is what is implied in most of these write-ups, I would ask, will this happen in India in a sense, will the Muslim population be growing than what it was in 1947? You would find every strand of Muslims in India doing their business, their children are being educated, and the government provides fellowships.” 

Inviting people to come to India and see the ‘ground’ reality for themselves, the Union Finance Minister also said that Muslims of every strand in India are doing their business, their children are being educated, and the government is disbursing fellowships. Law and order, she further stated, was not an issue of the Union of India but that of the state and provincial governments. 

Busted: Socio-economic data and reports of unabated, unchecked violence against India’s marginalised Muslim minority sharply contradict the claim that a rise in the population after partition means the religious minority is as secure as the rest of Indians and faces no persecution and discrimination.

In her speech, the Finance Minister’s seems to be saying broadly that:

(i) There is no violence or discrimination against Muslims in India.

(ii) A growth in population from independence is evidence for the above, i.e., there is no violence against Muslims in India. 

(iii) Muslims can do business, get an education, and get government scholarships without hurdles. 

It takes no genius in the social sciences to conclude that it may not be necessary to have a steep fall in numbers or even a full-blown genocide to substantiate the claims that a minority suffers from unchecked violence. Lack of political representation over decades declining to a zero over the past nine years, the absence (denial) of education and other basic rights including health services combined with socially and politically sanctioned entrenched prejudice –that in the same period of the past nine years has taken the form of unchecked calls for both social ostracism and economic boycott– are some clear manifestations of a systemic exclusion and denial. There is sufficient data to assert that the minister’s claims on India being a safe haven for minorities are based on a combination of a coloured ideological gaze and as dangerous, a manipulation of statistical data.

Do the Finance Minister’s claims hold ground? In order to have a closer look at what she said, let’s look at what the data tells us. 

Claim #1: There is no violence against Muslims in India. 

Busted: Observers note a sharp increase in violence against Muslims since the BJP government came to power. Data substantiates these claims, revealing a clear pattern showing that many hate crime incidents have occurred mainly in BJP-ruled states. The past four years have witnessed a large number of upheavals and stories of violence and discrimination against minorities. From the police brutality and state-led prosecution of people protesting the Citizenship Amendment Act in 2020, to the north-east Delhi violence of 2020, to the very recent Ram Navmi incidents of violence (2022, 2023), Muslims in India face the threat of continued violence. 

CJP keeps track of hate crimes and violence against religious minorities and marginalized caste groups in India, presenting a map that tallies such violence across the country. Termed the Nafrat ka Naqsha, this map reveals 37 reported counts of hate speech since January 2023. Several elected representatives of the ruling Bharatiya Janata Party (BJP), its members or ministers have been proponents of these speeches. Ms Sitharaman hails from the same political party. 

CJP’s constantly updated map also shows that around 31 instances of communal violence, including lynching by vigilante groups, have been reported in the past three months. Law-enforcement agencies in these states have even provided immunity to the assailants in some cases by refusing to register FIRs against them, filing criminal claims against victims, and even colluding with offenders to escape prosecution. Put together, these facts reveal a deliberate denial of constitutional protection (Articles 14, 15,16 and 21) for the Muslim minorities and a pervasive immunity for both perpetrators and law enforcement personnel who collude. This callous abdication of the law by state and non-state actors continues even as the Muslim minorities (and others like Christians, Dalits, Adivasis) face violence. These facts point to a harsh reality far at odds with Nirmala Sitharaman’s response at the PIIE. 

Claim #2: A growth in the population of Muslims means that Muslims don’t face violence or discrimination in India. 

Busted: There is no theoretical or statistical basis to establish a link between figures of rising population growth and discrimination or violence faced by a social category or group. A lack of social security and increased economic deprivation levels are accepted basis or factors for groups and communities to have more children, seen as a source of support for them.  Besides, denial of representation that amounts to denial of access includes denial of health care and education for the thrice oppressed sections within Minorities, the Women. Both factors, Muslims are a group that face high levels of poverty as a whole and Muslim Women are denied access to education and health schemes in particular, both factors that also contribute to population figures.

Research shows that about 25 percent of people forced to beg for a living are Muslims. Among all groups, Muslims are the least upwardly mobile social group. Even the dwindling number of available government benefits for Muslims rarely reach the targeted group for several reasons, including awareness and lack of government outreach measures and difficulty in procuring identification documents required to avail of government benefits. Political representation is an accepted factor in ensuring deeper democratic access of groups and communities. Representation of Muslims during the rule of Ms Sitharaman’s party, the BJP has dwindled to naught. Of the 303 Lok Sabha and 92 Rajya Sabha Members of Parliament that the party boasts of claiming undisputed majority, there is not a single Muslim. Of the over 1,000 MLAS (elected officials in state assemblies) belonging to the BJP, there is no Muslim.

Claim #3: Can Muslims really do business with ease in India?

Busted: Muslims from all economic groups face hurdles in earning a living due to rising violence and discrimination. From businesses to small-scale vendors and daily wagers, consistent communal violence, socio-economic marginalisation, and even campaigns for an economic boycott of Muslims make it challenging to earn a day’s wage in India. It is noted by scholars of communal violence, such as Paul Brass, that riots against Muslims are particularly orchestrated to target shops and businesses, along with other factors. This phenomenon that goes back decades has arguably reached a peak recently.

Claim #4: India’s Muslims can afford education and government fellowships.  

Busted: The present Union Government’s own actions belie this statement. It is Ms. Sitharaman’s government (Ms Smriti Irani, Minority Affairs Minister) which scrapped the Maulana Azad National Fellowship (MANF). These scholarships were instituted post 2006, after the Union of India, finally accepted the Justice Sachar Committee Report, Social, Economic and Educational Status of the Muslim Community of India, a document fortuitously still available on the website of the Minorities Affairs Ministry. On qualifying a National Eligibility Test, MANF was a research fellowship to selected students from India’s religious minorities. The union government also drastically cut down the budget for minorities by 38 percent for the fiscal year 2023-2024, in addition to a stark 50 percent cut for special schemes for minority students. Even before Ms Sitharaman’s statement, the Indian State (read Union Government) has reversed baby steps that were a much delayed acknowledgement of institutional discrimination against Muslim minorities in India.

Besides, several developmental indexes reveal that Muslims have the lowest education enrolment rates amongst all religious groups and face educational marginalization, according to several reports. They also have the highest dropout rates- especially from primary to middle school. According to the All India Survey of Higher Education 2020-2021 (AISHE), the total enrollment percentage of Muslims in higher education is 4.6 percent of the total population enrolled. In contrast, the religious minority consists of about 14 percent of the total population of India. In addition, Muslim students face discrimination by the state and school administration. In 2022, young Muslim school girls were prevented from attending school in the BJP-ruled state of Karnataka, after a government order issued a notice banning the hijab in schools, which forced hundreds of Muslim girls to drop out. 

Where does Nirmala Sitharaman’s misrepresentation of statistical data lead us?

 The Finance Minister’s carefree and cynical  usage of statistics is misleading in many ways. First, as emphasised above, the claim that the supposed rise in a group’s population indicates the well-being of minority populations is itself fallacious. There is  no correlation between the two. Muslims in India, today, are among the most targeted religious minorities that also lag behind in almost every socio-economic index. Their representation in the Indian Parliament is at an all time low in proportion to their population that is 14 %.. In fact, Sitharaman’s own party, by mid-2022 the BJP, has been noted to give zero representation, in terms of seats in the parliament, to Muslims. Apart from the fact that the BJP has simply no Muslim political representative as stated above, the declining representation of Muslims is systemic as revealed by these figures: In Indian Parliament, the political representation overall, of Muslims came down by half from 49 in 1980 to 27 in 2017. (In 2009, it was at 30). Going by the population of Muslims which is at 14 % of the Indian population, they should have at least 77 MPs but the numbers today, in 2023 are 27.

The rising, unchecked, and often state-endorsed violence against Muslim and Christian minorities has further presented a hurdle in the progress and development of the communities. 

Finally, do these claims of a rising Muslim population hold ground?

According to Pew Research Center, India’s population has tripled since independence due to a massive shift in life expectancy, living standards, and food production. Thereby, every religious group in India saw an increase in numbers post-Partition. While the growth rate of Muslims is higher than other groups, according to Pew’s findings, the ratio and proportion of religious groups in India have remained relatively stable, rubbishing claims of a supposed attempt to overthrow the Hindu population by Muslims.

As the former Chief Election Commissioner (CEC) of India and author of the book titled ‘The Population Myth: Islam, Family Planning, and Politics in India, S. Y. Quraishi, puts it, family planning measures rarely reach marginalised communities, which generally are forced to live in segregated localities, often low-income, vulnerable groups such as Muslims due to a lack of accessibility to health services. 

The fertility rate of Muslims has been declining sharply, faster than the Hindu community even, according to the National Family Health Survey – 5 (NFHS) conducted in 2022. The declining fertility rate in Muslims is a sharp 46 percent, and that in Hindus is 41 percent. Smaller families are becoming the norm in many Muslim households, according to the NFHS survey. The rising costs of quality education and private education can often act as a deterrent to Muslims from having more children. Due to economic strains, the government has often advocated, though not enforced, methods of contraception and family planning over the years.

The government of India has been notably infamous for having engaged in forced sterilization drives of poor Muslims several times in the past. Thereby, one can note that there has been considerable mythmaking related to apparent notions of population increase or population explosion of the Muslim community in the aftermath of partition. Such perceptions and rumours have often given rise to hate speech, paranoia about Muslims, and harmful stereotypes. According to an Oxfam India survey conducted in 2021, one-third of Muslims are subjected to prejudice when they try to avail of healthcare services in private and government-run health facilities across India. 

Is India’s Union Finance Minister, Ms Sitharaman’s highly publicised allusion to the growth of the Muslim population an isolated remark or part of pernicious anti-Minority propaganda?

Is there a strain of Islamophobia to be detected in the Union minister’s reference to the rising population? First, this statement is only the latest among high-level attempts to deny the targeted violence being allowed to occur without check, against religious minorities. Second, the political and social sanction behind this bald statement –emanating from the top of both the political and organisational hierarchy of the ruling party– can only embolden the hate-mongers among Ms Sitharaman’s party peers or the non-state actors and groups who add grist to this mill.. 

Dangerous too, as the statement can also potentially add fodder to existing tropes and fears about the mythical rise in Muslim population in relation to the numerical majority, the Hindu community. Hate speech against Muslims is replete with dangerous doses of falsified facts and selectively jumbled statistics that attest to “rising” Muslim populations and the supposed danger this demographic imbalance could pose to India’s Hindus.

Several BJP ministers and right-wing media houses often propagate this enduring right-wing rhetoric to evoke widespread, angered sentiments against Muslims. Acting ministers and politicians evoke the bogey of a return to ‘Muslim-ruled India’ the rising population will bring along with fears of a numerical and political transformation of Hindus into a minority. Propaganda by the Hindu Right, which began early in the 1970s, insisted that Muslims are anti-national as they don’t adopt contraceptive measures. Ms Sitharaman, through her statement on April 11, 2023 in her official capacity, has attempted an official stamp of approval on this pernicious hate-driven propaganda.

Fear Mongering about the return to ‘Mughal rule’ or Muslims overtaking Hindus numerically has been prevalent in the speeches of the supporters and members of the BJP and RSS. Mohan Bhagwat, sarsanghchalak of the Rashtriya Swayamsevak Sangh, in an address in 2021, spoke about the rising population of India’s Muslims as well and called for a policy to balance the population. Nirmala Sitharaman seems to be evoking the self-same stereotype, with little regard to facts, to erase the stark reality of widespread social and economic exclusion and politically driven violence against minorities in India. 

References 

https://www.google.com/amp/s/amp.scroll.in/latest/1011223/33-of-muslims-experienced-religious-discrimination-in-hospitals-finds-oxfam-india-survey

https://www.google.com/amp/s/amp.scroll.in/article/812272/muslims-have-the-lowest-rate-of-enrolment-in-higher-education-in-india

https://frontline.thehindu.com/news/budget-cut-for-minority-affairs-ministry-intensifies/article66462801.ece

https://www.google.com/amp/s/m.thewire.in/article/rights/hate-crimes-minorities-india-cmri-report/amp 

1000s or hundreds of thousands, the Karnataka govt’s ill-motivated ‘Hijab ban’ has pushed Muslim girls out of school

(Source: Unlike Pakistan’s Minorities, Every Strand of the Muslim Community is doing Business in India, The Hindu.)

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Finance Minister Nirmala Sitharaman has introduced two proposals to boost total demand in the economy by over Rs. 1 lakh crore on October 12, 2020. 

“We estimate that the measures announced today for boosting consumer spending and capital expenditure will boost demand by 73,000 crore, to be spent by March 31, 2021. Given that private sector spending through LTC tax benefit would be at least 28,000 crore, we estimate total demand boost due to today’s measures to be more than 1 lakh crore,” said a press release.

The Finance Minister said that these stimulus measures will have an impact on people who have been affected by Covid-19 and are desperately trying to keep their business going. The press conference came hours before the third round of Goods and Services Tax (GST) Council meeting that would discuss the problem of compensating states for the Rs. 2.35 lakh crore shortfall in their revenue share from the indirect tax of 2020-21.

The first proposal that deals with consumer spending looks into the Leave Travel Concession (LTC) Cash Voucher Scheme and the Special Festival Advance Scheme.

The Finance Minister proposed that under the LTC Cash Voucher Scheme, government employees can choose cash amounting to leave encashment and three times ticket fare, to buy items that attract GST of 12 percent or more. Only digital transactions will be allowed and a GST-Invoice will have to be produced.

“The biggest incentive for employees to avail the LTC Cash Voucher Scheme is that in a four-year block ending in 2021, the LTC not availed will lapse, instead, this will encourage employees to avail of this facility to buy goods which can help their families,” she said.

This scheme would cost an estimate of Rs. 5,675 crore for the Central government and an estimated cost of Rs.1,900 crore for Public Sector Banks and Public Sector Undertakings. She also said that state government and private sector can also avail these tax concessions

“Indications are that savings of government and organized sector employees have increased. We want to incentivize such people to boost demand for the benefit of the less fortunate. On a conservative basis, we expect the Scheme to generate additional consumer demand in the range of 28,000 crore,” said Sitharaman.

Meanwhile, the Special Festival Advance Scheme would be a one-time measure revived for non-gazetted and gazetted government employees. All central government employees would receive an interest-free advance of Rs. 10,000 as a prepaid RuPay Card to be spent by March 31, 2021.

“The one-time disbursement of Special Festival Advance Scheme is expected to amount to Rs. 4,000 crore; if given by all state governments, another Rs. 8,000 crore is expected to be disbursed. Employees can spend this on any festival,” she said.

Similarly, she proposed two measures to boost Capital Expenditure for the Centre and states and improve the country’s GDP.

Sitharaman recommended a special interest-free 50-year loan to states, for Rs. 12,000 crore capital expenditure with Rs. 200 crore each for the right Northeast states, Rs. 450 crore each for Uttarakhand, Himachal Pradesh and Rs. 7,500 crore for others, as per the share of Finance Commission’s devolution. These loans will have to be spent by March 31, 2021 with 50 percent given initially and the remaining amount upon its utilization.

“Under Part 3 of Rs. 12,000 crore interest-free loans to states, Rs. 2,000 crore will be given to those states which fulfill at least 3 out of 4 reforms spelled out in Aatma Nirbhar Bharat package. This is over and above other borrowing ceilings,” she said.

Moreover, a budget of Rs. 25,000 crore in addition to Rs. 4.13 lakh crore given in Budget 2020-’21, would be provided to the Centre for roads, defence, water supply, urban development and domestically produced capital equipment.

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In its efforts to move towards a $5 trillion economy, the NDA government is moving to decriminalize the Income Tax Act and the Prevention of Money Laundering Act (PMLA), said Finance Minister Nirmala Sitharaman at the Nani Palkhivala centenary celebrations in Chennai on Sunday, January 19, 2020.

According to the Finance Minister, the other steps being taken to reach the target of a $5 trillion economy are decriminalizing corporate laws, settling tax dispute and rapid privatisation of state-run firms.

As part of the changes to be made to the Companies Act, 46 penal provisions will be amended to remove criminality or reduce the punitive measures to only charging a fine. This is in addition to the 16 compoundable offences already decriminalized by the Companies (Amendment) Act, 2019. These changes will later also be extended to laws dealing with income tax and money laundering.

“I have gone through this (Companies Act) with a comb. We are working to decriminalise companies and ensure that no other Acts including Income Tax Act and PMLA, have such provisions,” Sitharaman said.

She also said that the government had no wish for laws that treat businesses with suspicion as that was not the intent of the government, adding that the government had already identified the statutory changes to be made to improve the ease of doing business.

She also emphasized the need for a quick resolution of pending tax-related disputes, mentioning that for income tax cases, the government would replicate the successful dispute resolution scheme launched last year for indirect taxes.

One of the arguments for the decriminalization of some of the offences in the Companies Act and others thereafter, is that doing so will free up the courts to address more important offences. However, the cases registered for such offences aren’t the only ones that plague the courts in India. Lack of effective deterrents, unnecessary litigations and the misuse of the law are some of the main reasons for the overburdening of the justice system.

The decriminalization of certain offences under the Companies Act is riddled with problems, reads an editorial by The Telegraph. Because of the set of companies in India being diverse, monetary fines can have different implications on different firms depending on their net worth. The formula for calculating penalties for different companies is unclear and the transference of imposing penalties from the legal system to quasi-judicial bodies that include civil servants, can increase the potential of companies indulging in opportunistic behaviour.

Deliberate violations could be triggered with the understanding that the penalty imposed would be much less than the advantage obtained from the violation.

Bharat Vasani, a partner at Cyril Amarchand Mangaldas emphasizes that the ‘special courts’ assigned by the government to deal with economic offences must be strengthened to improve the disposal of cases.

Keeping in mind the above uncertainties surrounding the government’s decision, the Companies Act which is like the Constitution for the corporate world, should be ensured to not be made meek by the wholesale decriminalization that the government is looking to implement. There are also concerns that decriminalisation could be a method to shield perpetrators of corporate malpractices many of which often fall in gray areas. Decriminalisation should not be allowed to enable corporates to engage in exploitative practices that adversely affect consumers and employees.

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The picture being circulated on social media, in a bid to counter the FM’s narrative, is that of a man wearing police protective gear over his plain clothes, standing with some police men and being identified through his Facebook profile as a member of Akhil Bharatiya Vidyarthi Parishad, a right-wing group that is affiliated to the Sangh Parivar. One wonders what business does an ABVP member have wearing police gear and inflicting brutality on students?

While students of Universities like Jamia Milia Islamia in Delhi and Aligarh Muslim University in Lucknow came out in large numbers to peacefully protest the contentious Citizenship Amendment Act (CAA), they were faced with unprecedented police brutality.

Amidst such a sensitive scenario Sitharaman made an offensive and ill-informed comment saying, “I don’t know what happened at Jamia last night; we must be wary of jihadists, Maoists, separatists getting into student protests”. At one end she says she doesn’t know what happened there and on the other hand she makes an unfounded assumption that there may be elements like jihadists, Maoists, separatists in a students’ protest!

There were also some images and videos shared by social media users questioning why persons in plain clothes were engaging in lathi charge on students, along with the police.

Like in the above image, the man in a red t-shirt is even wearing the head gear of the police! What does this imply? Does the Finance Minister have any explanation for this?

To counter her claims though, a picture is surfacing on the internet and being shared on social media:

Once again, a person in plain clothes can be seen wearing police protective gear and this person is being identified from his Facebook profile as Bharat Sharma with a long allegiance with right wing organizations. He turned out to be an Executive Member of Akhil Bharatiya Vidyarthi Parishad, a right-wing students’ organization and also a volunteer of the Rashtriya Swayamsevak Sangh (RSS), the ideological parent of the ruling BJP. The caption below the image translates as, “Now tell us Ms. Nirmala Sitharaman who are these “Maoists, Separatists and Jihadists”? RSS, ABVP, BJP committing violence along with the police!”

While one could still question the veracity of this image, and this person’s identity is difficult to ascertain, it is clear that people in plain clothes were actually “allowed” by the police to wear their protective gears and to indulge in brutality on students. Is it not illegal to impersonate a police man? The police have immunity from the State, and the police have delegated this immunity to these rogues? Is there a perilous complicity between the police and these right-wing organizations we are not aware of and should we not be wary of them instead? When will the government break their silence on this?

These are just some questions the government will choose not to answer at this moment and some questions the masses will keep asking and it is upon the judiciary now to pull up the authorities and the government and get to the root of this.

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Interview with Paranjoy Guha Thakurta
Interviewed by Prabir Purkayastha Produced by Newsclick Team,

The government has doled out new benefits for corporate houses while the economic slowdown continues to squeeze the common man. Senior journalist Paranjoy Guha Thakurta discusses the implications of the corporate tax concessions announced by the finance minister today. 

Courtesy: Newsclick.in

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We compared finance minister Nirmala Sitharaman’s speech from July 5, 2019, with former finance minister Arun Jaitley’s speech when the party came to power in 2014. 

Jaitley’s speech was 16,489 words long and lasted 2 hours, 7 minutes and 42 seconds. Sitharaman’s speech was 20,223 words lasting 2 hours, 9 minutes and 13 seconds. In places, the pace of the speech differed. So, we analysed the word-count as well.

We calculated the ratio of words spent on each topic to the full word-count of the speech. We derived the words used on each issue largely from the sections into which the speech itself is divided, barring cases such as agriculture that did not have a separate section in 2019 unlike in 2014.

Here’s how the two finance ministers chose to use their time announcing the Union budget: 

Agriculture:
Nirmala Sitharaman spent around 3 minutes, 1.11% of the duration of her speech, on agriculture, discussing the potential of agricultural produce to generate revenue from “allied activities” such as the generation of renewable energy and sale of timber and bamboo.

In 2014, Arun Jaitley had spent 8 minutes, 7.22% of his budget speech, on agriculture, outlining the government’s plan to improve the agriculture industry technologically, set up universities and research centres for the same, and create substantial programmes for the extension of long- and short-term agricultural credit.

Sitharaman spent around 16 minutes, 6.16% of her speech, talking about rural development, two-thirds of which focused on affirming the success of the government’s schemes over the past five years and outlining the current government’s goals for the future. She announced one allocation: Rs 80,250 crore to the Pradhan Mantri Gram Sadak Yojana, as part of her speech on rural development.

In comparison, Jaitley spent 3.5 minutes, 2.63% of his speech, on rural development, speaking about the National Livelihood Mission, Rural Housing and the Backward Region Grant Fund to develop basic infrastructure in backward areas.

Taxes, Business and Finance:
Sitharaman spoke for 36.5 minutes (60%) as compared to Jaitley (30%), who spoke for 36 minutes on taxes.

Apart from “announcing” a slew of tax sops that were previously announced by her predecessor finance minister Piyush Goyal in February 2019, Sitharaman also announced a 3% surcharge on income over Rs 2 crore per annum, and a 7% surcharge on income over Rs 5 crore per annum. She extended a 25% corporate tax to companies with a turnover of up to Rs 400 crore.

Aside from taxes, Sitharaman spent nearly 20 minutes, 6% of her speech, outlining the government’s policies for business, including the banking and financial sectors.

In comparison, Jaitley spent close to 5 minutes, 10.1% of his speech, describing programmes for the business class. 

This included talking about foreign direct investment, bank capitalisation, public sector units’ capital expenditure, instruments such as real estate investment trusts (REITs) and infrastructure investment trusts (InvITs), the eBiz platform (a business-to-business commerce platform), micro, small and medium enterprises (MSMEs), and the finance policy.

Healthcare:
Including the expenditure by states, India spends 1.4% of its gross domestic product (GDP) on health. This is still is still much below the 2.5% of GDP goal set by the National Health Policy of 2017, and even the 2010 target of 2% of GDP, as IndiaSpend reported in April 2017. Nepal spends 2.3% of its GDP on health while Sri Lanka spends 2%, data show, as IndiaSpend reported in January 2018.

The word ‘health’ appeared in Sitharaman’s speech thrice: first, while outlining the government’s vision for the coming decade; second, while praising the impact of the Swachh Bharat Abhiyan; and third, while describing tax incentives for individuals to spend on healthcare.

Jaitley had spent more than 3 minutes, 2.15% of his speech, describing the government’s healthcare programmes, including setting up new All India Institutes of Medical Sciences in various states, as well as government medical colleges and model rural healthcare research centres.

Education:
Sitharaman spent a larger proportion of her speech discussing education (5 minutes, 2.42%) than Jaitley did in 2014 (2 minutes, 1.46%).

Sitharaman’s speech focused on higher education, and the ‘Khelo India’ programme.

She called for the creation of a commission of higher education in India, and allocated Rs 400 crore for the formation of “World Class Institutions”. Cuts in education spending as a share of total expenditure, announced by Piyush Goyal in the interim budget, as IndiaSpend reported on February 5, 2019, were left unaddressed in her speech.

Jaitley’s speech focused more on primary and middle schooling, including the Sarva Shiksha Abhiyan and a teachers’ training programme. 

Renewable energy:
Sitharaman mentioned the word ‘renewable’ twice in her entire speech; neither reference dealt with any government programme. Towards greener energy alternatives, nearly 1% of her speech was devoted to electric vehicles, in which she expounded upon tax incentives and government investment to promote the use of electric vehicles.

Jaitley had spent close to a minute, 1.3% of his speech, outlining plans regarding renewable energy for the implementation of ultra mega solar power projects in five states, and the construction of a Green Energy Corridor. He mentioned ‘climate change’ on three occasions and the word ‘environment’ once in his speech.

Ganga rejuvenation:
The discussion about the Ganga has diverged between 2014 and 2019.

Sitharaman spent around a minute, 0.59% of her speech, on the Ganga, and did not mention the National Mission for Clean Ganga, launched in 2011. Instead, she predicted that with increased focus on developing the navigational capacity of the river, the movement of cargo would increase by four times in the next four years.

Jaitley spent around a minute as well, 1.19% of his speech, on the Ganga, outlining his plans for navigation projects on the river and a Ganga Conservation Mission, then budgeted at Rs 2,037 crore, including an non-resident Indian (NRI) fund.

Urban issues:
Jaitley spent nearly 4 minutes, 3.37% of his speech, introducing the government’s urban programmes, laying out a vision for increased shared investment, low-cost housing, slum development, the Atal Mission For Rejuvenation & Urban Transformation (AMRUT) and the Smart Cities Mission.

Sitharaman spent close to half that amount (3 minutes, 1.85%) focusing on urban matters. She congratulated the achievements of the urban housing scheme and called for more investment for transport infrastructure via public-private partnerships, including metro-lines and suburban railways. She did not mention either smart cities or the AMRUT programme.

Water:
Sitharaman spent around 1.5 minutes, 1.12% of her speech, on water, an issue that is critical in the face of consecutive drought and increased scarcity, as IndiaSpend reported (here and here). She announced the merger of the ministries of water resources, river development and Ganga rejuvenation into the Jal Shakti Mantralaya. The Har-Ghar-Jal and Jal Jeevan Mission will ensure piped water access to all households in India by 2024, she said. 

Jaitley had spent 37 seconds, 0.42% of his speech discussing water in 2014, describing projects as the National Rural Drinking Water Programme, including treatment of sewage and industrial effluents, and de-contamination from flouride, arsenic, etc. in both urban and rural areas.

(Mehta, a second-year political science undergraduate at the University of Chicago, is an intern at IndiaSpend.)

We welcome feedback. Please write to respond@indiaspend.org. We reserve the right to edit responses for language and grammar.

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Image Courtesy: TechGig Bureau

The first budget of the second Modi Government presented by Nirmala Sitharaman is nothing short of a payback gift after the elections to corporate India and foreign financial interests, says the CPI-M in its responses. The Budget and the speech were full of several promises and commitments that would help big corporate capital and the wealthy to strengthen their grip on the Indian economy and foster greater integration of the Indian economy with international financial markets. There is nothing  in the budget for working Indians, the farmers (kisans) and workers,  who have been left to fend for themselves in a world of shrinking opportunities for employment and livelihood states the press release issued today.

The finance minister’s speech listed a long menu of pro-corporate ‘reforms’ – opening up the Indian economy even more to foreign portfolio and direct investment (including the pension sector), creating a ‘financeable’ model for highways, promoting PPP in several areas including railways and metro development, etc. and even commercialization and financialisation of social welfare through a ‘Social Stock Exchange’.

There were no references, however, to the issues of remunerative prices and debt relief that India’s farmers are in desperate need of. On labour, the creation of a more anti-labour labour code was also presented as a ‘reform’.

While all of these were talked about, the FM’s speech was generally short of any real details regarding the revenue measures and expenditure commitments of the Union Government for 2019-20 and was completely silent on the problems of economic slowdown, agrarian distress, industrial stagnation and joblessness that everyone knows currently afflict the Indian economy.

As regards the actual Budget, the Finance Minister chose to not disclose the actual figures for revenues and expenditures for 2018-19 even though they are available by now. Instead the revised estimates presented in the Interim Budget on 1 February were retained in the final Budget – obviously in order to conceal the verifiable fact that the actuals of both revenues and expenditures in the previous year were significantly lower than in the Budget Estimates and even the Revised Estimates of the Interim Budget. This manipulation of the Budget accounts only serves to establish that the expenditure commitments for 2019-20 lack credibility as they will be cut if needed to meet fiscal deficit targets.

The estimates of gross revenues from Central taxes for 2019-20 have been reduced relative to the Interim Budget by almost Rs. 91,000 crores, and 40 per cent of this loss will have to be borne by State Governments. The reduction in estimated revenue collections is attributable to reduced projections for GST (by nearly Rs. 98000 crores) and Income Tax (Rs. 51,000 crores) – an indirect admission of the failure of the so-called reform measures of the Government that it had claimed would improve tax compliance.

What is shocking is that instead of addressing the fundamental problems in the taxation system and raising more resources from direct taxes except through extremely piecemeal measures – the Finance Minister has chosen to give several tax concessions to the corporate sector even while burdening the common people with additional excise duties on petrol and diesel to the tune of Rs. 2 per litre. Hitting at the public sector is the Government’s chosen additional route for raising resources. On the one hand disinvestment of public sector enterprises to the tune of Rs. 1.05 lakh crores is being planned. Further, PSEs will be bled by squeezing more of their profits out of them for the Government – and this amount has been raised from Rs. 1.36 lakh crores in the Interim Budget to 1.64 lakh crores in the final one. Even after all of this, the projected figures will keep the expenditure to GDP ratio the same!

The budget shows very little increase in spending for people. The total percentage of subsidies as per cent of total expenditure have remained almost unchanged at about 12 per cent. The first Woman Finance Minister of the country had presented a budget in which the expenditure on women has fallen from 5.1 per cent to 4.9 per cent of the total budget. Even the Nirbhaya Fund for women’s safety has not seen hardly any increase. There has been a marginal increase in spending on welfare of Scheduled Castes and Scheduled Tribes but this continues to be much less than their share in the population. Only 2.9 per cent for welfare of Scheduled Castes and 1.9 per cent of total expenditure for welfare of Scheduled Tribes. There is a decline in allocation for Umbrella Scheme for Scheduled Castes by 2000 crores. Share of allocations for the Ministry of Minority Affairs has remained unchanged. In the context where government’s own statistics are showing a massive increase in unemployment, the Finance Minister has cut the allocation for MGNREGA by Rs. 1000 crores as compared to the revised estimates for last year. Spending on even the Swachh Bharat Abhiyan, First Modi Government’s flagship programme, has been reduced by about 4500 crores.

The Union Budget for 2019-20 reflects the complete denial by the Government of the real economic situation of the country, which is living proof of the inability of a private capital led development process to either address the agrarian crisis or create employment opportunities outside it. This 2019-20 budget, therefore, is bound to mount further economic burdens on the vast majority of our people.

The CPI(M) calls upon the Indian people to join the protests that are bound to emerge in the coming days against the various aspects of these anti-people proposals in order to force the government to adopt policies aimed at improving people’s livelihood.
 

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