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Analysis of Union Budget 2019-20
I heard the long speech on Union Budget 2019-20 of the size of Rs 2786349 crore slightly lower than that of the interim budget by Finance Minister (FM) Nirmala Sitharaman with rapt attention.

I observed with convictions, with honesty of purpose that she has proved to be faithful student of economics (not exactly as professional economist) with her beautiful oratory deserving appreciation for the blue sky thinking of the second avtar of NDA government. The implementation of FRBM Act is well received as fiscal deficit stands reduced to Rs 703760 crore, 3.3 per cent of the GDP; however, revenue deficit at Rs 485019 is higher than the interim budget is not understandable.

It can safely be inferred that the FM has succeeded in proving pro-poor, pro-women, pro-rural, pro-farmer (zero budget farming to be understood, analysed, interpreted for doubling the income of the farmers) may be called lip service by some if not many stake holders including consumers, producers, distributors and traders.

The contribution of the corporate sector (21 paisa in a rupee) of the total financing and also rich for social responsibility may lead to reduce the income inequalities (limited extent). The middle class who are the backbone of the economy are bound to be poor in the real sense of the terminology despite of the fact of the ease of living and e-filing income tax return with faceless re-assessment. The income tax payers deserve more than appreciation, some privileges including priorities in travel by air and first class Ac in trains (let others pay 30 per cent more for enjoying such privileges). The motivation for buying electrical vehicles with reduced GST and income tax exemption of Rs 1.50 lakh fits into the domain of consumerism.

The reduced NPA will give some relief to the banking sector especially for the public sector banks wherein govt refuelling will help to boost all the sectors of the Indian economy.

It is relevant here to draw attention of the stakeholders on UN World Happiness Report 2019, which ranks countries on a few key variables that support well-being: per capita income, freedom of choice, trust, healthy life expectancy, social support and generosity and perception of corruption. In 2016 India was at 118 and slipped down to 122 in 2017 and further slipped down to 133 in 2018. In 2019 it has further slipped down to 140. So much so that even Sri Lanka, Bangladesh, Nepal, Bhutan and Pakistan ranked much better than India. Only 16 countries are unhappier than India among 156 countries. We need continuous monitoring of the policies and programmes.

To bring the wave of 'hope' for better days  with sab ka vikas, sab ka sath and sab ka vishwas as promised by the prime minster (PM) , the finance minister could have defined concrete plan of action more than lip service for commemorating 150th birth anniversary of Mahatma Gandhi by converting Khadhi and Village Industries Commission (KVIC) into an MNC. This fits into the framework of new India vision of globalization (think globally and act locally) for solving the problem of poverty and unemployment including under-employment.

There is a strong case for linking income tax exemption with Consumer Price Index (CPI) for industrial workers (IW) which is the basis for additional dearness allowance (ADA) twice a year in January and July. At least ADA should be exempted which is the so called compensation for the inflation for employees of the Government at all levels. There is no logic and rationale to tax house rent allowance received by the employees owning their houses. There is no justification for taxing the fixed medical allowance for taking preventive, promotive and curative health by the employees of all cadres and creed in India.

To see eye to eye with the world as reiterated by the PM, we need new orientation to the defence budget which is merely 9 percent allocation of the total budget of 2019-20. I was expecting a separate budget for defence which is need of the times. It is to be noted that appropriate expenditure on defence is an engine of economic growth via peace which is necessarily a basic infrastructure.

There is a strong case for coordination between fiscal policy (no subsidy), monetary policy (zero rate of interest), national manufacturing policy (modernization of MSMEs) and foreign trade policy (no import of second-hand, obsolete and rejected technologies) for the acceleration of growth in various sectors of the Indian economy.

To explore the path ahead for achieving Sustainable Development Goals (SDGs) 2030, we need to develop concrete plan of action for controlling population which is otherwise given lip service by the stakeholders.

To capture the full potential of 'Make in India', 'Skill India' and start-up scheme for generating employment for achieving SDGs in India ,  we need to treat business more than money making with altruism  to touch the lives of some if not many  as social entrepreneurs  for which FM has  announced Social Stock Exchange, deserve to be appreciated.

Global dynamics depict maximalism with all its merits and demerits whereas we need minimalism to take care of our needs and not greed. The time has come to use minimax strategy (minimising the possible loss by decision rule in artificial intelligence (AI) as worst case). Maximin strategy needed to maximise the minimum gain to face the challenges of global dynamics.

For proving Incredible India as independent, nonviolent, democracy with integrity and amity, we need to learn spiritual economics (needonomics - confining to needs ) and no to greed (economics of greed - greedonomics) which is nonviolent in nature for  living and working without worries.

For achieving new India vision with 5 trillion economy by 2024-25, we need to become street smart (simple, moral, action oriented, responsive and transparent) as real human capital more than the so called demographic dividend. It would be relevant to adopt the canons of public expenditure advocated by  BR Ambedkar who said that every Government should spend the resources garnered from the public not only according to rules, laws and regulations, but should also see that 'faithfulness, wisdom and economy' are adhered to in the acts of expenditure by public authorities. We need to monitor union budget 2019-20 with the eyes of Ambedkar as economist.

*The writer is professor of economics, researcher, orator, prolific writer and experienced administrator in higher education under state, public and private sector as Vice Chancellor, PVC, Director and Dean.

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