The budget has exposed the NDA government's nervousness -Yamini Aiyar

-Hindustan Times

Fiscal prudence has been compromised in favour of pleasing every conceivable vote bank the NDA can appeal to

What a difference five years make. In July 2014, when the National Democratic Alliance (NDA) unveiled its first full budget, finance minister Arun Jaitley made clear that the NDA was against “mindless populism”. “India,” he said in a media interaction, “has to make a choice between mindless populism and fiscal prudence…. the general elections of 2014 have proved that you don’t need populism to win elections.”

Five years later, as finance minister, Piyush Goyal, broke convention and converted an interim budget into a full budget, the turnaround is complete. Mindless populism is all that the NDA will go to the polls with. Fiscal prudence has been compromised in favour of pleasing every conceivable vote bank the NDA can appeal to.

As Goyal stated in his speech, fiscal deficit targets have been sacrificed to make way for the farmer income transfer scheme without which “fiscal deficits would have been less than 3.3% of GDP this year and 3.1% for next year”. Add to this the tax cuts for the middle class and the strategy is clear: it’s populism all the way.

In attempting to please every vote bank that counts, the government has clearly exposed its nervousness. That a government about to go to the electorate after five years in power has to make its case on future promises rather than achievements of the past is a clear admission of failure. Although, true to style, Goyal lost no opportunity to use the budget speech to share his government’s achievements and vision for the future. So much so, that this columnist spent much of the budget speech wondering whether it was written for an election rally. Undoubtedly, the fact that this budget broke the long-standing convention of interim budgets being just that — interim — is going to be the headline of the day. But this budget also broke convention by converting a budget speech — which ought to be a standard presentation of policies and revenues and expenditures — into an electoral pitch. This is a dangerous precedent.

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Hindustan Times, 2 February, 2019,

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