The upcoming union budget that will be presented in the first week of February 2018 can easily be expected to be more of a political, or better said populist one, than the one focused on economic and financial prudence. It can be predicted that the depressed classes, Scheduled Castes, and Scheduled Tribes, will certainly see an uptick in budgetary spending on schemes which are specifically targeted at their progress. Following are the reasons for the same;
- Plan formulated by government’s topmost think-tank, NitiAayog
A factor contributing to higher spending on the welfare of SCs and STs is the plan formulated by government’s topmost think-tank, NitiAayog, and which will be the basis for increased earmarking of funds. While the allocation for SCs for FY17 was INR 38833 crores (BE), it saw a 35 percent hike in FY18 to INR 52393 crores; for STs, allocation in FY18 was INR 31920 crores.
- SCs and STs form a sizeable electorate
The SCs and STs together make up one-fourth of the total population, and it is not only their social and economic backwardness that contributes to the allocation of special funds to them. They are a sizeable electorate, and for the incumbent BJP to firm its grip over the national political scene, these classes will be co-opted without any hesitations.
The recent show of strength by Dalit groups in Maharashtra and eventual ruckus is evidence of growing disillusionment within these classes for the ruling BJP.Add to this the loss of seats suffered by the ruling BJP in Gujarat elections where disenchantment of rural parts, combined with the siding of a young Dalit leader with the Congress, is sure to upset the reformist stance of PM Modi.
The last full budget to be presented in 2018 will be a lawful tool for the party to win over this electorate. Although the present Prime Minister has claimed the reputation of a reformer, political compulsions cannot be ignored. The combined allocation for both groups will be more than 1 lakh crores in the upcoming budget, even when the government is struggling for revenues, and the sword of breaching the fiscal deficit target of 3.2 percent is hanging over its head.
- Last ditch attempt to win the public support before the 2019 election
The BJP-government will make the last-ditch attempt to pacify, even appease, the public that is feeling the short-term pains of otherwise-progressive twin policy actions, demonetization, and the new indirect tax regime, GST.
The time ahead of 2019 general polls can see a shift from bold reforms to spending on activities that directly, visibly and speedily benefit the masses. The government will not want to lose its tag of being pro-poor hence allocation to SC/ ST schemes, such as free coaching, venture capital fund, and scholarships, in Budget 2018 will outshine last year budget.
Suvipra view
In 2017, the finance minister had declared that they would introduce outcome-based monitoring of expenditure; hence how this reflects in Budget 2018 will be an interesting watch.
Also read: Budget 2018 will not be anything like its precedents
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