From Doles to Development
Present circumstances:
- The finance minister’s recently released Union budget 2023–24 was praised for its brave decision to redirect funding for agriculture, food production, and rural areas away from handouts and towards development.
- Despite this, there are nine state assembly elections scheduled for this year, and the Lok Sabha elections will occur in about a year. The FM has, however, avoided the need to advertise freebies. To enhance infrastructure and increase jobs, she has proposed a budget that is growth-oriented, asset-creating, and inclusive.
Converting spending from revenue-based to capital-based:
- When compared to the RE for 2022–2023, the budget requested a considerable drop in MGNREGA spending as well as food and fertiliser subsidies in 2023–2024. The sum of these cuts comes to about Rs 1.7 lakh crore.
- The money saved from these doles has been invested in more productive projects like Jal Shakti, rural housing, roads, and railroads, all of which will have positive benefits on rural India.
Spending on capital infrastructure growing:
- The revised estimate for 2022–2023 has been increased from Rs. 1.62 lakh crore to Rs. 2.41 lakh crore, a 48.6% increase.
- In comparison to 2022–2023, the cost of roads and highways will increase to Rs 2.70 lakh crore in 2023–2024. (RE).
- This demonstrates the government’s focus on Gati Shakti to reduce logistical costs.
- The cost of logistics and the supply chain accounts for around 12% of India’s GDP, which is more than the 8% global average.
- With enhanced rail, road, air, and water connectivity, Indian goods, particularly agricultural products, will unquestionably become more competitive. This will also help to keep inflation under control.
- The country will gain a lot from this well-thought-out plan in the years to come.
The PM Awas Yojana (Grain) has been given spending money:
- The PM Awas Yojana is yet another crucial asset-creating initiative (Gramin). The total expenditure has increased to Rs 54,487 crore, a net increase of 172.4%, from the 20,000 crore that was allotted for the PM Awas Yojana in the 2022–23 budget.
- However, when compared to the RE of 2022–23 (Rs 48,422 crore), which was already much higher than the BE of 2022–23, the rise in 2023–24 looks to be only 12.5%. (Rs 20,000 crore).
- The programme was launched in 2016 with the intention of giving everyone access to housing. It also provides living dignity, expands employment prospects, and ensures permanent asset development for rural households in India. This is a considerable improvement in the way subsidies are now allocated to help fund the development of rural infrastructure.
Jal Jeevan Mission has expanded:
- From Rs 55,000 crore in RE of 2022–2023 to Rs 70,000 crore for 2023–2024, the Jal Jeevan Mission (JJM) has seen an increase of 27.3%.
- This is mostly done to supply clean drinking water at faucets in rural areas. This will save women who must go considerable distances to get water time and energy, in addition to preventing water-borne infections.
Compared to the previous year, the Pradhan Mantri Kaushal Vikas Yojana (4.0) has increased by 85%:
- It plans to increase the “Amrit Peedhi’s” influence and provide skill-training to tens of thousands of young people over the next three years.
- There are other things that are envisioned, including on-the-job training, business relationships, and curriculum modifications.
- The amount spent for this purpose has increased by 85%, from Rs 1,902 crore (RE) in 2022-2023 to Rs 3,517 crore (BE) in 2023-2024.
- Additionally, the Pradhan Mantri Kaushal Vikas Yojana seeks to include contemporary industrial subjects like mechatronics, robotics, AI, and 3D printing. In order to equip young people for opportunities overseas, the FM has also announced that 30 Skill India International Centers will be constructed across several states. This is a heroic deed.
Advances in technology are needed in the agricultural sector:
- FM has established an Agri-Focused Accelerator Fund. She also proposed creating a digital public infrastructure for agriculture that is open-source, open-standard, and interoperable.
- This would enable inclusive and farmer-centric solutions by providing information services for crop planning and health and improving access to agricultural inputs, loans, and insurance. Farmers will have access to market data and more precise crop estimates. Although these are constructive actions, we must wait to see how much funding will be given to these programmes.
- High-value horticulture crops are being promoted thanks to the Atmanirbhar Clean Plant Programme, which aims to expand the accessibility of high-quality, disease-free planting material. A budget of Rs 2,200 crore has been allocated for the programme.
- Building storage facilities and value chain infrastructure in remote areas is still challenging.
- Investment in agricultural research needs to be quadrupled if India is to improve it, make it more competitive, and make it more climatically robust.
Conclusion:
- The government has made a long-term strategic decision to invest more in capital projects and less in operations that generate revenue.
- The long-term benefits of capital investment over economic growth, employment creation, and inflation control.
