large businesses. ‘Welfareism’ was used to create
new vote banks and consolidate existing ones. For
Modi, it seemed to be the need of the hour as he
tumbled from one assembly election to another and
tried to notch up victories to bolster his party’s
numbers in Rajya Sabha.
This is no longer the case. The BJP has a sizeable
presence in the Lok Sabha and its numbers in the RS
are likely to go up. Hence, this is an apt time to focus
on key economic reforms, at least for the next three
years. But again, apart from national policies, the
finance minister has to seek specific regional solu-
tions. It is important to augment farm incomes; the
previous regime said it would double them by 2022.
The government must remember that farmers in
different states require different inputs.
Similarly, small and medium businesses and the
informal sector took a huge beating over the past few
years. Since they are among the largest employers,
not just in India but also in other nations, theirgrowth and health are crucial. Budget 2019 can
provide incentives for them. For example, as a recent
economic survey stated, labour-intensive sectors
like leather and textiles should be encouraged. Still,
the finance minister has to keep regional complexi-
ties in mind as she finalises her policies.E
VEN as Sitharaman keeps her eyes on the ground
and fine-tunes her strategies, she needs to rise up
to take a bird’s eye view of the economy. Growth
has stuttered, development has taken a beating,
government finances are in a mess and we are now
in an era of job shrinkage, not jobless growth. These
have to be fixed fast. A slew of big-ticket reforms in
Budget 2019 can spur confidence, which in turn can
hasten investments across sectors.
A huge spend on infrastructure can have multiple
impacts on growth and job creation. The previous
government allocated huge sums to build roads,
ports and airports, and improve river navigation. But
more needs to be done. Tax-free infrastructure
bonds may be an alternate mechanism to raise the
huge amounts required. Aggressive private partner-
ships, which were given up midway in the previous
regime, can be resuscitated. More importantly, a
10-year infrastructure blueprint has to be in place.
Sitharaman’s advantage is that she starts on a clean
slate. Unlike her predecessor, Arun Jaitley, she is
under no compulsion to dole out sops to her party’s
allies. This was important when Modi came to
power; not so, when he has regained it. With Modi’s
mandate, she will get the support of citizens, even if
she has to take a few hard decisions. She can set India
on to a new economic trajectory with no major
political opposition.
However, there is a huge caveat. May 2019 had
far-reaching politico-economic implications for
politicians, policy makers and people. The election
results proved that growth and development may
not be necessary to woo voters and win polls. This
realisation can make this regime over-confident and
complacent. It may decide that changing the
socio-political equations within the society is more
crucial than economics to ensure future victories. If
this turns out to be the case, Budget 2019 will be an
act in futility. O
(The author is a journalist, writer and researcher)A NEW RECIPE FOR SABKA VIKAS
The government must balance macro-economic concerns with gra ssroots issues and pursue transparency and continuity to revive India’s growth story
DOLING OUT
Halwa ceremony
to mark the
beginning of
printing of
budget docsGrowth has
become
sluggish,
government
finances are
in a mess
and we are
now in an
era of job
shrinkage.8 July 2019 OUTLOOK 45
PTI