A Budget for All: Ahead of 2024 general elections, Modi sarkar gets it right
There’s something for everyone in the Union Budget 2023-24 – the poor, the tribals, and India’s women. With five big announcements on personal income tax, the ‘hard-working’ middle class has reasons to cheer. The groundwork is laid for state polls this year and the 2024 general elections
FP Explainers Last Updated:February 01, 2023 20:09:24 IST
Finance Minister Nirmala Sitharaman's Budget 2023 has been hailed by the middle class and India Inc. AP
It’s the last full Budget of the Modi government 2.0 before the country goes to polls in April and May of 2024. And it has something for everyone. Nirmala Sitharaman’s financial statement has promised more homes and better health for the poor, tax concessions for the middle class, and capex boost for industries and businesses.
We take a look at what the ‘first Budget of the Amrit Kaal’ has to offer its vote bank as India gets into election mode. (Before the big 2024 test, come the elections in nine states this year.)
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Homes, health, and more
Welfare schemes for the poor, who have been backing the Bharatiya Janata Party (BJP), are plenty. Prime Minister Awas Yojana, which aims to provide affordable housing to the poor in urban areas, has been allocated a whopping Rs 79,950 crore, a 66 per cent rise from Rs 48,000 crore in the Financial Year 2022-23. About 2.94 crore poor people are promised homes by 2024, of which 2.12 crore houses have been handed over.
To provide Clean drinking water from taps to 20 crore households, Rs 70,000 crore will be spent on the Jal Jeevan Mission. In last year’s Budget, Rs 60,000 crore was allocated to the scheme. Until 2019, three crore households were provided drinking water. That number is now up to Rs 11 crore and is expected to be a game-changer for the BJP in the general elections, according to a News18 report.
The Jal Jeevan Mission aims to provide clean drinking water to households and is expected to be a game-changer in the 2024 elections. AFP
Allocation for the Ayushman Bharat health insurance scheme, which has made health insurance affordable, has increased from Rs 6,457 crore to Rs 7,200 crore. Under the scheme, more than 4.5 crore poor Indians have benefitted.
Backing farmers and tribals
The Budget has kept in mind the farmers. In the new financial year, the PM Kisan Nidhi Scheme, which provides aid to small and marginal farmers, will get Rs 6000 crore.
PM PRANAM (Prime Minister Programme for Restoration, Awareness, Nourishment and Amelioration of Mother Earth) will seek to incentivise states and Union Territories to promote alternative fertilisers and the balanced use of chemical fertilisers.
Under the GOBARdhan Scheme, a programme for the management of cattle and organic waste, the government aims to set up 500 new waste-to-wealth plants. Of these plants, 200 will be compressed biogas plants, including 75 in urban areas and 300 community-based plants, to be set up with an investment of Rs 10,000 crore.
The major focus is on tribals with the government allocating Rs 15,000 crore for their development. This is about five times more than the sum set aside for tribal affairs last Budget.
Meghalaya, which has more than 85 per cent tribal population, will go to polls later this year. AFP
“To improve the social-economic condition of the particular tribal groups, PMPVTG(Prime Minister’s Particularly Vulnerable Tribal Groups) Development mission will be launched, to saturate PBTG habitations with basic facilities. Rs 15,000 cr to be made available to implement the scheme in next 3 years,” Sitharaman announced.
The tribal population is a key vote bank in several states, where elections will be held this year. Chhattisgarh and Tripura have more than 30 per cent tribal population (Scheduled Tribes) and Meghalaya, Mizoram and Nagaland account for over 85 per cent of the tribal population.
Women make a difference
The FinMin stated that empowering women is one of the “four emphasis points” of the Budget 2023. The most significant announcement was the proposal of the “Mahila Samman Saving Certificate” with a fixed interest rate of 7.5 per cent for two years. The deposit can be made in the name of a woman or a girl child.
The Budget also unveiled policies that will assist women entrepreneurs, especially in rural areas, to procure raw materials and better branding for their products, according to a report in Bloomberg.
India’s women population is expected to benefit from Budget 2023. AFP
The support of women has increased for the Modi government over the years. As BJP retained power in four states [Uttar Pradesh, Uttarakhand, Goa, and Manipur] last year, Modi said, “…we have won splendidly in areas where women voters have dominated. Nari Shakti has been our partner in this victory.”
More women came out to vote for the BJP compared to the men in these states, according to a joint study conducted by the New Delhi-based Centre for Policy Research and the University of Oslo, reports Bloomberg.
Finally, the middle class
Ahead of every Budget, the middle class hopes for tax concessions. More often than not they are disappointed. But not this time.
To benefit the “hard-working” middle class, Sitharaman made five big announcements on personal income tax. She proposed to raise the rebate limit from Rs 5 lakh to Rs 7 lakh in the new tax regime. Anyone who has opted for this regime will not have to pay income tax if their annual income is up to Rs 7 lakh.
Tax concessions in this year’s Budget have given the middle class a reason to rejoice. AFP
She has also announced changes to tax slabs in the new regime. This will also provide major relief to all taxpayers in the new regime. “An individual with an annual income of Rs 9 lakh will be required to pay only Rs 45,000 as income tax — which is only 5 per cent of his or her income. It is a reduction of 25 per cent on what he or she is required to pay now,” the FM announced.
Sitharaman has in the past said that she hails from a middle-class family and is familiar with the pressure of the high cost of living that they face. Now she has announced changes that will bring cheer.
While rural voters have always been the focus of politicians, the attention is now also on the middle class. It voted for Modi in large numbers in the 2014 and 2019 elections and believed in his promise of “vikas’ and “acche din”. And there is little reason why it won’t back the BJP government as it heralds the ‘Amrit Kaal’.
With inputs from agencies