Union Budget 2017: Arun Jaitley bats for Indira-style populism, junks Nehruvian dreams

One thing Finance Minister Arun Jaitley’s budget for 2017-18 reveals is that the NDA government led by Prime Minister Narendra Modi is not fond of Nehru Age ambitions but simply loves Indira Era populism. And then, we might add, the RSS-bred leaders weaned on Hindu nationalism are also happy to co-opt Mahatma Gandhi into their thought process.

Jaitley mentioned Gandhi at least three times in his speech, after first referring to him as ‘Father of the Nation’. Gandhian thinking might be a political compulsion for the Bharatiya Janata Party, long described as an urban-centric party before Modi’s juggernaut firmly established it as a clear national party with rural support in 2014.

However, the party clearly knows that the rural base cannot be taken for granted. That probably explains – especially with elections looming in Punjab and Uttar Pradesh – the eagerness with which spending plans to help the poorest of the poor are no longer a taboo and in fact, a preferred option for the party long considered fiscally conservative.

Union Finance Minister Arun Jaitley

Union Finance Minister Arun Jaitley

The record allocation for the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) programme, at  Rs 48,000 crore, to provide jobs to 50 million households, is an open acknowledgement of the philosophy of the Congress party.

Though MNREGA’s origins lie in the Food For Work programme conceived in the anti-Congress Janata Party rule between 1977 and 1980, the Congress developed it further as the Integrated Rural Development Programme before it was repackaged as a jobs guarantee scheme a decade ago under the UPA. Modi himself has been a critic of the MNREGA an once called it a “living monument of UPA’s failure” before it became “a national pride”.

Allocation for scheduled castes (SC) has been increased to Rs 52,000 crore for the next fiscal year from Rs 38,000 crore in the current year,  no doubt with UP’s Dalits in mind. But it is a big step for the BJP, long described as a party of upper caste Hindus.

Other schemes including the Pradhan Mantri Gram Sadak Yojana, also smack of a rural or pro-poor thrust.

All that smacks of the politically savvy populism of the kind Indira Gandhi championed in her “Garibi Hatao” days of the 1970s.

On the other hand, Jaitley’s budget marked one more step in the Modi government’s march to end Nehru-era ambitions. The budget does away with distinction between plan and non-plan expenditure, a logical step forward from the recasting of the erstwhile Planning Commission into the NITI Aayog by Modi soon after he came to power in 2014.

Typically, “Plan” expenditure refers to asset-creating development-oriented expenditure, as distinct from unproductive expenses. Conservative economists see no reason for such distinction – and certainly are not in favour of state-controlled industrial assets on a large scale.

Jaitley’s budget plan to merge state-run oil giants to form one behemoth is nothing but a step towards their disinvestment, increasingly through the new mechanism of exchange traded funds (ETFs). Oil and railways, both considered “strategic” for state control in the Nehru Age and Indira Gandhi years, are both being partially if not systematically privatised.

In sum, the Modi government’s message is: Nehruvian industrialisation is not welcome, Indira-style populism is.

(The author is a senior journalist. He tweets as @madversity).



Updated Date: Feb 01, 2017 16:15 PM

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