Good economics is quiet, and good economists support policy outcomes. economic research, Message from the President The first day of the first parliamentary session of the new year, budget (or interim budget) speech The Finance Minister's statement is the most important statement of government policy. Together, they communicate the government's intentions loud and clear.
The NDA government likes to be very noisy. This year, the Minister of Finance (FM) chose to use a loudspeaker while presenting the Interim Budget for 2024-25. The media simply amplified that noise. Much to the chagrin of FM, the budget had disappeared without a trace by the end of the next day.
tired and bored
I think people are getting fed up and fed up with what the government has been saying over and over again over the last 10 years. They remember that they were promised 2 billion jobs a year. Even as technology companies report cutting 260,000 jobs in 2023, they are handing out thousands of appointment letters to fill existing government vacancies. They said that if everyone had Rs 1.5 million in their bank accounts, it would be deposited after “recovering unaccounted for money hidden within and outside India”. They know that the suspected fraudsters who were allowed to leave the country are alive and well in their countries of refuge and not a single one has been extradited to India in the last 10 years. They also remember promises to double farmers' incomes by 2022, provide housing for every family, and achieve a $5 trillion economy by 2023-24. Therefore, people were amused by FM's claims.
some examples
FM: These and the provision of basic necessities increased real incomes in rural areas.
fact:According to PLFS data and India Labor Situation Report (Azim Premji University), the real growth of three types of workers (regular, temporary/daily workers, and self-employed) between 2017-18 and 2022-23 Wages are stagnant.
FM: …the government has helped 25 million people find freedom from multifaceted poverty.
fact: According to UNDP, the number of people lifted out of poverty was 275 billion (UPA) and 14 billion (NDA).
FM: Under the Prime Minister Kisan Samman Yojana, direct financial assistance is provided to 1.18 crore farmers including marginal and small farmers every year.
fact: The number of beneficiaries has decreased to 8.12 billion farmers as of November 15, 2023. Landlords (who own the land) are compensated, but tenants (who cultivate the land) are excluded.
FM: A large number of new higher education institutions were established: 7 IITs, 16 IIITs, 15 AIIMS and 390 universities.
fact: As of March 22, 2023, the “vacancies'' were in IITs (9,625), IIITs (1,212), and Chuo Universities (22,106). As of March 15, 2022, the vacancies for faculty and trainee posts in AIIMS, Delhi were 1,256 for him. In his 19 other AIIMS, the vacancies were 3,871.
FM: Prime Minister Mudra Yojana has sanctioned loans of Rs 43 million, amounting to a total of Rs 225 billion, for the entrepreneurial aspirations of the youth.
Fact: The average loan amount is Rs 52,325. If we categorize these loans into Shish (83%), Kishore (15%) and Tarun (2%), it is clear that the majority of the loans are Shish. A simple calculation based on published data reveals that Sishu's Rs 3,569 crore debtor received his Rs 900,000 crore. So the average loan amount is Rs 25,217. What kind of business can you start and run with a loan of Rs 25,000?
FM: The Goods and Services Tax allows for “one country, one market, one tax”.
Fact: If there is one tax that all businessmen and traders are united against, it is GST. The GST law is deeply flawed and has become an instrument of harassment and exploitation.
FM: Through active inflation management, we were able to keep inflation within the policy range.
fact: Apparently, the government's understanding of policy bands is not the same as the RBI's. The RBI is doing the heavy lifting to bring down inflation to 2-4% and the government is testing the permissible upper limit of 4-6%. The average CPI inflation rate for the five years from 2019 to 2024 was 5.6%. Food inflation is 8.7%. Milk 5.07 percent. Fruit 11.4%. Vegetables accounted for 27.64%.
FM: Ensuring timely and adequate finance, relevant technology and appropriate training for Micro, Small and Medium Enterprises (MSMEs) to grow and compete globally is a key policy priority for governments.
fact: Thousands of small businesses closed their doors during the pandemic years due to a lack of support from the government. The government has distorted and drastically reduced the guarantee against losses of Rs 300,000 crore on bank loans, reducing bank loans to just Rs 300,000 crore. Based on available data, it is estimated that around Rs 200,000 crore was disbursed.
FM: Exports of marine products also doubled from 2013 to 2014.
fact: The doubling in nine years (from Rs 30,627 million to Rs 64,920 million) is based on current rupee prices.
In USD terms, the increase from USD 5.016 billion to USD 8.078 billion is only 60%, a modest CAGR of 5.4%.
Non-Legal Warning: The use of loudspeakers may cause hearing loss.
