A ‘luring’ budget for the salaried middle class; a shock to many; and a disappointment to other sectors across the board. The Union Budget 2025 presented by finance minister Nirmala Sitharaman in Parliament for the eighth consecutive year on Saturday was lack-lustre and grossly undercut national interests. Yet the Modi-led government won laurels with a lavishly crafted bouquet of tax reliefs for the middle-income group, principally the white collar employees in both government and private sectors. A closer look at the budget proposals would shock one.
For instance, the government would be losing over Rs 1 lakh crore in taxes on account of the tax exemption scale being stretched from the present Rs 7 lakh to Rs 12 lakh and more on earnings for the middle class. This is no small sum. The railway sector would get just Rs 2.52 lakh crore; which is short by Rs 10,000 crore compared to last year. For the agriculture sector, the allotment is Rs 1,71,437 lakh crore. A claim is that the government would get back a certain percent of this lost income from the tax the middle class pay for purchases they do with the new savings. This, prima facie, sounds ludicrous. If money circulation in market is the government’s aim to boost the economy, it should have taken different steps. It is appalling that some 95 per cent of the population of 1.4 billion has been excluded from the tax bracket. The Modi government’s outreach to the salaried class is believed to be prompted this time by the approaching assembly polls in Delhi – the seat of the bureaucracy. The lavishing of funds for Bihar too in the last as well as the present budget, and for Andhra Pradesh, was obviously prompted by the coalition compulsions. The 2024 parliament poll verdict weakened the hands of Modi; and both Nitish Kumar and Chandrababu Naidu are demanding their pound of flesh.
The deep hit the exchequer takes — on grounds of tax relief to one and all — could be explained by the failure of the government to reduce allocations for several sectors or not increase the funds for even key sectors like the railways and the defence. There is a surprising reduction of 10,000 crore for the railways compared to last year. The increase in track length since 2014 is just 10km per day, on average, while the highway sector saw a three-fold increase. The rural employment guarantee scheme, which helps the poor, too did not get any increase. The funds were cut for the PMAY by 55 per cent; hurting the poor. Worse, at this critical time in defence, the allotment for it is less than two per cent of the GDP. The budget presentation itself lacked clarity in several aspects and was more of a smokescreen. There is too little about the railways. The dignity of the Union Budget is largely lost.