The take away from Budget 2025-26 is that the BJP is wooing the tax paying middle class and the Bihar electorate. These announcements will be welcomed by the 3.2 crore tax paying middle class and the 7.65 crore voters of Bihar. For the rest of India, the Hon’ble Finance Minister had no more than soothing words, punctuated by the applause of BJP members, led by the Hon’ble Prime Minister. 2024-25

Financial performance in2024-25

Let me first look at the financial performance in the current year, 2024-25.
Revised revenue receipts are lower by Rs. 41,240 crore. Revised net tax receipts are lower by Rs. 26,439 crore. On the expenditure side, total expenditure has been cut by Rs. 1,04,025 crore and capital expenditure has been cut by Rs. 92,682 crore. Of this cut, the sectors that have suffered most, and the amounts cut, are: · Health: Rs. 1,255 crore · Education: Rs. 11,584 crore · Social Welfare: Rs. 10,019 crore · Agriculture: Rs. 10,992 crore · Rural Development: Rs. 75,133 crore · Urban Development: Rs. 18,907 crore · Development of NE: Rs. 1,894 crore
The cruellest cuts were in allocations for the SC, ST, OBC and minorities. Examples: · PM Anysuchit Jaati Abhyuday Yojana
BE 2024-25 Rs. 2,140 crore RE 2024-25 Rs. 800 crore · PM Young Achievers Scholarship for OBC, EBC, DNTs.
BE 2024-25 Rs. 1,836 crore RE 2024-25 Rs. 1,381 crore · Post Matric Scholarship for SCs
BE 2024-25 Rs. 6,360 crore RE 2024-25 Rs. 5,500 crore · Programme for Development of STs
BE 2024-25 Rs. 4,300 crore RE 2024-25 Rs. 3,630 crore

Huge cost to economy

There is nothing to cheer about the fact that the government has improved the fiscal deficit from the BE of 4.9 per cent to the RE of 4.8 per cent. It was achieved at a huge cost to the economy. Those who did not believe us when we said that the economy is slowing down will, I hope, believe us now. Those who did not believe us that that the capacity of the government to plan and implement schemes has diminished will, I hope, believe us now. Capital expenditure for 2025-26 has been increased by Rs. 1,02,661 crore but, having regard to the experience of 2024-25, I doubt the capacity of the government to achieve the target. I am glad, however, that the FM has shed her faith in astrologically determined numbers.

Programmes/Schemes short changed

Without burdening you with numbers, I urge you look at the Budget Estimates and Revised Estimates for 2024-25 and the proposed Budget Estimates for 2025-26 for the following programmes/schemes. They clearly indicate that (i) the government has lost faith in these programmes announced with fanfare in the previous Budget speeches and (ii) the government’s capacity has significantly diminished. Examples are POSHAN, Jal Jeevan Mission, NSAP, PMGSY, Crop Insurance Scheme, Urea Subsidy, and PM Garib Kalyan Anna Yojana. The Railways have been short changed. If you examine the Railway specific heads of expenditure, you will find that BE 2024-25 was Rs. 2,06,961 crore RE 2024-25 is Rs. 2,12,786 crore BE 2025-26 is Rs. 2,13,552 crore
Railways serve the overwhelming majority of the population. The increase of a paltry Rs. 766 crore in 2025-26 will not even account for the inflation. The allocation will be less than last year’s allocation.
On the much-vaunted PLI schemes plus New Employment Generation Scheme plus Skill India programme that were promised to create thousands of jobs, the youth of this country have been cheated. Against a BE 2024-25 of Rs. 26,018 crore, the actual expenditure will be only Rs. 15,286 crore.

No will, no new ideas

Finally, it is evident that neither the FM nor the PM care for the advice of the Chief Economic Adviser. He gave sensible advice in the Economic Survey. “Get out of the way” was his call to the government. On the contrary, the Budget is full of new schemes and programmes, many of which are beyond the capacity of this government. I counted at least 15 new Schemes or programmes and 4 new Funds. The FM is walking on the worn-out path. She is not willing to break free as we did in 1991 and 2004. She is not willing to de-regulate. She is not willing to get out of the way of the people, especially the entrepreneurs and the MSMEs and the start-ups. It is the bureaucracy that will be happy with this Budget. The strangle- hold of government on the activities of the people is getting tighter. In closing, I would like to say that the economy will trudge along on the old path and deliver no more than the usual 6 or 6.5 per cent growth in 2025-26. This is a far cry from the 8 per cent growth rate that the CEA estimated in order to become a developed country. In our view, this is a government with no new ideas and no will to reach beyond its grasp.

Based on Press Briefing on Budget by Shri P. Chidambaram and Shri Gaurav Gogoi on February 1, 2025

Leader of Opposition (LS) Shri Rahul Gandhi’s Tweet:

A band-aid for bullet wounds!

Amid global uncertainty, solving our economic crisis demanded a paradigm shift.

But this government is bankrupt of ideas.