Disillusioned Finance: Analyzing the Flaws in India’s Budget 2024
The Indian Union Budget for 2024-25, unveiled by Finance Minister Nirmala Sitharaman on July 23, 2024, has failed to inspire confidence among citizens and economists alike. Despite the Finance Minister’s optimistic portrayal of economic growth and government spending, the reality on the ground suggests a troubling disconnect between official figures and public sentiment. This editorial critically examines the key issues with the budget and the broader implications for India’s economic landscape.
The Mirage of Increased Expenditure
One of the central arguments put forth by Finance Minister Nirmala Sitharaman is the purported increase in government expenditure. She highlighted that expenditure on various sectors has risen significantly from 2013-14 to 2024-25, citing examples such as an increase in funding for agriculture from ₹0.30 lakh crore in 2013-14 to ₹1.52 lakh crore in 2024-25. However, this presentation of data raises several concerns.
Firstly, these figures are presented in current prices rather than constant prices, which fails to account for inflation and the real value of the expenditure. Moreover, without context, the absolute increase in expenditure provides a limited view of fiscal policy. To truly gauge the effectiveness of spending, it should be analyzed as a proportion of total government expenditure or GDP. The lack of such contextual analysis suggests a superficial approach to addressing economic issues.
The Unemployment Enigma
The issue of unemployment remains one of the most contentious aspects of the current economic climate. The Finance Minister dismissed concerns about rising unemployment by referring to government reports, which claimed a decrease in the unemployment rate to 3.2%. This figure contrasts sharply with estimates from independent sources, such as the Centre for Monitoring Indian Economy (CMIE), which reports an unemployment rate of 9.2%.
The Finance Minister also cited a report indicating the creation of 125 million jobs between 2014 and 2023. However, this optimistic outlook is contradicted by the overwhelming number of job applicants for relatively few positions. For instance, the Uttar Pradesh Police Constable Recruitment Examination attracted over 48 lakh candidates for 60,244 positions, while the Staff Selection Commission had nearly 25 lakh applicants for 7,500 posts. These figures suggest a glaring mismatch between job availability and the number of candidates, raising serious questions about the government’s employment statistics and the effectiveness of its job creation policies.
Inflation and Economic Stagnation
Inflation is another area where the budget has fallen short of addressing pressing concerns. The Finance Minister’s critique of the previous UPA government’s handling of inflation during the 2009-2013 period, while accurate, does little to address current inflationary pressures. The rising costs of essential commodities, such as tomatoes, onions, and potatoes, have significantly impacted household budgets. The Wholesale Price Index (WPI) inflation stands at 3.4%, while Consumer Price Index (CPI) inflation is at 5.1%, with food inflation soaring to 9.4%.
Despite these high inflation rates, the Finance Minister has proposed no concrete measures to alleviate the financial burden on citizens. There have been no reductions in administered prices, taxes, or increases in minimum wages. Furthermore, the Reserve Bank of India (RBI) has maintained a bank rate of 6.5% for the past 13 months, indicating persistent inflationary pressures and a lack of effective monetary policy interventions.
The Budget’s Cold Reception
The reception of the 2024-25 Budget has been notably tepid. The general public, as well as political and economic commentators, have expressed skepticism about the budget’s efficacy in addressing India’s economic challenges. The Finance Minister’s optimistic projections and selective use of data have failed to resonate with a populace grappling with high inflation and unemployment.
In the context of the broader economic scenario, the budget appears to be a missed opportunity to address systemic issues and offer meaningful solutions. The Finance Minister’s dismissal of the challenges faced by ordinary citizens and her reliance on selective data have only deepened the public’s disillusionment.
Conclusion: A Disconnect Between Policy and Reality
The 2024-25 Union Budget, despite its grand projections and optimistic claims, falls short in addressing the real economic challenges facing India. The discrepancies in expenditure data, the contentious unemployment statistics, and the lack of effective measures to combat inflation reflect a disconnect between government policy and public reality. As India continues to grapple with these issues, a more transparent and effective approach is needed to bridge the gap between policy promises and the lived experiences of its citizens.
Sunil Garnayak is an expert in Indian news with extensive knowledge of the nation’s political, social, and economic landscape and international relations. With years of experience in journalism, Sunil delivers in-depth analysis and accurate reporting that keeps readers informed about the latest developments in India. His commitment to factual accuracy and nuanced storytelling ensures that his articles provide valuable insights into the country’s most pressing issues.
