/ Economics / Budget2016 another Jumla: Social Movements waiting Acchedin

Budget2016 another Jumla: Social Movements waiting Acchedin

Social Movements not convinced with the Government’s tall claim of a pro-poor budget 2016-17, hoping it’s not yet another Jumla!
Peoples Voice on March 1, 2016 - 2:37 pm in Economics

Government of India presented its annual budget with much fanfare, claiming it to be pro-poor and pro-rural, but the question looms whether it will really change the fortunes of the marginalized sections of the society. In year 2014-15, the unspent amount of Planned Budget is Rs 1,12,356 crores, showing how far the Government fell short of its targets. The major unspent amount is from the Education, Water and Sanitation, Scheduled caste, Scheduled Tribe, Backward and Minorities. Wastage and diversion of taxpayers’ money can be seen from the budget statements. As expected, the rich do not have many reasons to frown, as they have not been burdened with any substantial tax liabilities. However, the poor will have to bear more burden through increased indirect taxes and additional cess to expand the revenue base of the Government.

JaitlyThe Government still does not seem committed enough to reduce its fiscal deficit as it has allowed the Revenue Foregone (also now termed as “Revenue Impact of Tax Incentives under the Central Tax System”) to increase from Rs. 5,54,349 Cr in the year 2014-15 to Rs 6,11,128 Cr in 2015-16, where the Revenue Foregone primarily benefits the Corporates and the rich people of the country. This calls for urgent review of the various sectors which benefit from Revenue Foregone, which can be channelized to reduce the fiscal deficit of the country. Just to put things in perspective, Fiscal Deficit in the year 2015-16 stood at of Rs. 5,55,649 Cr and in the year 2016-17 it is Rs. 533904 Cr.

Given below is a snapshot of few of the sections of the budget to analyze how it fares compared to last few years:

Table-1: GDP, Budget, Fiscal Deficit, Interest Payment and Revenue Foregone

(Rs. in Crore) 



Budget GDP – Advance Estimate Revenue Foregone Interest Payment Fiscal Deficit = Borrowing
Plan Non-Plan
2008-09 BE 2,43,386 5,07,498 53,21,753 4,58,516 1,90,807 1,33,287
2009-10 BE 3,25,149 6,95,689 61,64,178 4,82,432 2,25,511 4,00,996
2010-11 BE 3,73,092 7,35,657 78,77,947 4,59,705 2,48,664 3,81,408
2011-12 BE 4,41,547 8,16,182 89,12,179 5,33,583 2,67,986 4,12,817
2012-13 BE 5,21,025 9,69,900 100,28,118 5,66,235 3,19,759 5,13,590
2013-14 BE 5,55,322 11,09,975 113,55,073 5,72,923 3,70,684 5,42,499
2014-15 BE 5,75,000 12,19,892 126,53,762 5,89,285 4,27,011 5,31,177
2015-16 BE 4,65,277 13,12,200 135,67,192 6,11,128 4,56,145 5,55,649
2016-17 BE 5,50,010 14,28,050 150,65,010 NA 4,92,670 5,33,904

Apart from the macro-economic analysis of how the budget will serve the interest of the poor, it is also important to look into the budget from the perspective of specific communities, such as handloom weavers, fishworkers and Scheduled Caste and Scheduled Tribes.

Handloom Sector – Handloom sector is the second largest employer in rural area and is dependent on traditional skills of weavers community. Handloom sector has much less impact on the environment unlike the mechanized textile industries. The governmental support in budgetary terms is not catering the need of weaver community, however, there for the namesake there is a marginal increase in the budget. 

Table-2: Budget Allocation for Handloom Sector 2016-17
Year Textile Ministry Total Handloom
Plan Non- Plan Total Plan Non- Plan Total
Budget 2014-15 BE 4831 866.4 5697 242 72.51 314.5
Budget 2015-16 BE 3523 751.5 4275 360 80 440
Budget 2016-17 BE 3350 1245 4595 612 98 710

As it can be seen from the table, that there has been some increase in the budget allocation for the handloom sector, after long and consistent engagement with the government, but it still falls short from the due share, which the handloom sector should get.

Fishery Sector – Fishery Sector is covered under the Department of Animal Husbandry, Dairy and Fisheries. Fishery Sector supports employment of roughly 1.5 crore fishworkers across the country and contributes 0.83% of GDP. Fishery Sector generates one of the largest sources of employment dependent on natural resources.

Table-3: Budget Allocation for Fisheries Sector 2016-17
Year Plan Non-Plan Total Plan Non-Plan Total
Budget 2014-2015 2174 92.3 2266.3 422.56 38.74 461.3
Budget 2015-2016 1491.14 94.29 1585.43 410.69 40.45 451.14
Budget 2016-17 1600.00 281.51 1881.51 450.00 125.34 575.34

As it can be seen from the table, that there has been some increase in the budget allocation for the fishery sector, after long and consistent engagement with the government, but it still falls short from its due share, which the fishery sector should get.

SCP/TSP – Special Component Plan (SCP) for Scheduled Caste and Tribal Sub Plan (TSP) for Scheduled Tribes are components of Union Budget, which are in effect since 1979-80 with provision for population-proportionate allocation for their welfare and development, with specific focus on individual family and hamlet.

Table 4 – Budgetary Allocation under SCP/TSP for Scheduled Caste and Scheduled Tribes for 2016-17

Indian Population 1,24,14,91,960 SC – 16.6% ST – 8.6% Budget Figures in Crores
2014-15 (BE) 2014-15 (AE) 2015-16 (BE) 2015-16 (RE) 2016-17 (BE)
Total Budget 17,94,892 16,63,673 17,77,477 17,85,391 19,78,060
Plan Budget 5,75,000 4,62,644 4,65,277 4,77,197 5,50,010
Non Plan Budget 12,19,892 12,01,029 13,12,200 13,08,194 14,28,050
Allocation / Expenditure for Scheduled Castes under SCP
Allocation under SCP 50,548 30,035 30,851 34,675 38,833
SCP (in percentage) 8.79 6.00 6.63 7.27 7.06
Due SCP 95,450 76,799 77,236 79,215 91,302
Shortage in SCP 44,902 46,764 46,385 44,540 52,469
Allocation /Expenditure for Scheduled Tribes under TSP
Allocation under TSP 32,387 19,921 19,980 20,963 24,005
TSP (in Percentage) 5.63 4.00 4.29 4.39 4.36
Due TSP 49,450 39,787 40,014 41,039 47,301
Shortage in TSP 17,063 19,867 20,034 20,076 23,295
Allocation /Expenditure for SC/ST together under SCP/TSP
Allocation under SCP/TSP 82,935 49,956 50,831 55,638 62,838
SCP/TSP (in percentage) 14.42 11.00 10.92 11.66 11.42
Due SCP/TSP 1,44,900 1,16,586 1,17,249 1,20,254 1,38,603
Shortage in SCP/TSP 61,965 66,630 66,419 64,616 75,765
Note: BE = Budget Estimate; RE = Revised Estimate, AE = Actual Estimate

From the above table it is clear that the budgetary allocations for the SC/ST are not in proportion to their population, which is acutely needed to bring them at the par with the rest of the communities. Rs 75,765 Cr is the shortage which is a huge gap in the budget allocation.

Political will of the government can be understood from the budget, which is a political document of the ruling party, in the line of the public demand and their wishes in financial figures. If not fully, then at least the budget can be understood partially by any layman or the aam aadmi. Aam aadmi sees this budget as less allocation for SC/ST, namesake increase for handloom and fishery sector, increased corporate subsidies (revenue foregone), increased interest liabilities for the nation, increased fiscal deficit and low tax effective rate (24.67%). Continued under-utilization of the budget, especially from social sector programs, like primary education, basic health care services, water and sanitation, etc. points towards the failure of the government to call itself pro-poor and beating the trumpet of “Sabka Saath, Sabka Vikas”. In view of this, social movements seek cooperation of honorable Member of Parliaments to debate effectively to meet the requirements of aam aadmi in the parliament during the budget session.

Delhi Forum