Union budget 2013: Chidu woos Nitish and boos Modi

Those, including Samajwadi Party chief Mulayam Singh Yadav, who predicted that Finance Minister P Chidambaram would present a populist pre-poll budget have been left disappointed. Also, those from the Congress who thought that this budget, the last before the next general elections, would give them the right talking points to take on their rivals didn’t get much.

In a budget speech of huge popularity and political interest, he did not use the word ‘aam aadmi’, which has been the Congress’s catch phrase since the run-up to the 2004 elections, even once. That perhaps reflects his sense of confidence in himself or his understanding that by now the aam aadmi has become a part of inclusive growth and thus did not need a ritual mention. The slogan `Congress ka haath aam aadmi ke saath’ seems to have given way to ‘Apka Paisa Apke Saath’ - this one in reference to the direct cash transfer scheme.

But the politician in Palaniappan Chidambaram took a different route to send out a political message of a different kind - he named Bihar eloquently to woo JD(U) leader Nitish Kumar and announce rejection of what the Congress refers to as the Narendra Modi development model, albeit without directly naming him or Gujarat.

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[caption id=“attachment_644042” align=“alignleft” width=“380”] Finance Minister P Chidambaram. Image courtesy PIB[/caption]

He used a quote from Nobel prize winner economist Joseph Stiglitz in the opening paragraphs of his budget speech to make his point against Modi and contrast that to credit of Congress-led UPA government at the Centre: “There is a compelling moral case for equity; but it is also necessary if there is to be sustained growth. A country’s most important resource is its people. We have examples of states growing at a fast rate but leaving behind women, the scheduled castes, the scheduled tribes, the minorities, and some backward classes.”

Though he did not mention Modi or Gujarat, this has been Congress’s standard criticism against Modi. During November-December 2012, it had tried hard to make it an election issue against him. It’s a different matter though that the finance minister mentioned the work in progress for the smart industrial city of Dholera in Gujarat while referring to the Delhi-Mumbai Industrial Corridor.

Chidambaram then asserted that “the UPA does not accept that model (the Gujarat model). The UPA government believes in inclusive development, with emphasis on improving human development indicators.”

A little later, the finance minister gave the thumbs up to the Bihar chief minister’s pet project, Nalanda University: “The reconstruction of the Nalanda University has gathered momentum. The government is committed to the creation of Nalanda University as a centre of educational excellence.” He also referred to Bihar for increasing its contribution in rice production and so on.

The gesture yielded immediate political dividend. While all other opposition leaders, including Mulayam Singh Yadav and Mayawati who are supporting the government from outside, criticised Chidambaram, Nitish Kumar made a fulsome praise of the finance minister. Thanking Chidambaram from the bottom of his heart, Nitish said, “The finance minister has now acknowledged in the budget that there was a case for revisiting the existing criteria so that new parameters were set for identifying backward states like Bihar extending some policy support. This is a big victory of the people of Bihar who have waging a relentless battle for the special category status demand.”

Chidambaram’s commitment to redevelop Nalanda University, which come in Nitish’s home district, was another reason of happiness for the JD(U) leader. Only two days earlier, Nitish Kumar had blasted the UPA government on its railway budget.

From Chidambaram’s perspective, it could be a long-term olive branch aimed at potential realignment of political forces in the post 2014. He does not have a winning formula on his hands now. Unlike the UPA-I’s farm loan waiver scheme and MNREGA, UPA-II’s Direct Cash Transfer and the proposed Food Security Bill are still don’t look full of promise given the time constraint. Though Chidambaram spoke at length about agriculture and increasing allocation of the rural development ministry, there was nothing substantive that a middle level Congress leader could convey to farmers of his area.

Chidambaram’s possible “game changing” message was contained in four long paragraphs where he went by the spirit of Congress’s Jaipur Chintan Shivir. “I wish to draw a picture of three faces that represent the vast majority of the people of India. The first is the face of the woman. She is the girl child, the young student, the sportswoman, the homemaker, the working woman, and the mother. The second is the face of the youth. He is impatient, she is ambitious, and both represent the aspirations of a new generation. The third is the face of the poor who look to the government for a little help, a scholarship or an allowance or a subsidy or a pension. To each of them, on behalf of the Government, the prime minister and the chairperson of the UPA, I make a promise.”

He then went on to announce an all-women bank and a fund for women safety-Nirbhaya Fund-in memory of the Delhi gang rape victim. For youth, he talked about skill development initiative and for the poor, direct cash transfer.

Chidambaram had a tough task at hand - maintain a balance between populism and pragmatism. He chose not to be guided by conventional wisdom, doling out too many populist schemes in the election year. He could be called a brave finance minister.