5 big takeaways from Budget 2018

Unlike the previous year, Finance Minister Arun Jaitley did not recite any poem in his budget speech, which took up all of 6,696 words. Union ministers and NDA leaders predictably described the Modi Government’s last full budget before the general election variously as ‘futuristic, inclusive, visionary and transformational’ even as Prime Minister Modi himself gushed in a special address, trolled on Twitter as the second budget speech of the day, that the budget is ‘people-friendly, farmer-friendly, environment-friendly’.

He also declared that his Government had moved from ‘Ease of Doing Business’ to enhancing ‘Ease of Living’ of the people.

So, what are the major takeaways from Mr Jaitley’s statement of the government’s revenue and expenditure?

• Haunted by Gujarat The close shave of the BJP and the PM in the Gujarat election in December clearly cast a shadow on the Budget. Realising that the last four budgets had not helped people in the rural areas, the Union Budget this time makes a valiant attempt to placate the rural constituency and farmers. Call it a panic reaction, a sign of desperation or another ‘big ticket reform’, the Budget’s focus on Agriculture, Animal Husbandry, Irrigation and the Bamboo Mission etc indicated that the Government has come down to earth.
• Where is the money? Most of the schemes announced in the Budget will be works in progress over the next, several years. This is indicated by the Finance Minister’s silence on allocations for, say, Modicare which seeks to pay healthcare costs up to ₹5 lakh per family to 100 million families. The health budget, however, shows no appreciable increase, a pointer that the Government was in greater hurry to roll out schemes without doing the groundwork first. It is doubtful that Modicare can roll out before early next year unless the Government wants to implement it in a hurry and repent at leisure.
• Farmers shortcharged? While the fine print needs to be studied more closely, Yogendra Yadav in his first reaction minced no words in accusing the Finance Minister of ‘sleight of hand’ and dodging the farmers with his announcement on enhanced MSP. Frankly, even the Finance Minister did not seem to have much clarity while reading out this portion of his speech. While Yadav felt that the FM had shifted the goalpost by speaking of the farmers’ gross cost of production, others wondered why the announcement covered only Kharif crops and not Rabi?
• Modicare: Both the FM and the PM waxed on the world’s biggest healthcare rolled out in the budget. Obamacare in the United States sought to protect only 36 million people while Modicare seeks to cover 500 million people and pay each of the 100 million families (which ones?) up to ₹5 lakh for hospitalisation (but not medicine?). Stocks of private hospitals surged following the announcement and it was clear that private insurers and hospitals are looking at a windfall. But how will it work and who will it eventually benefit will be clear only in the medium term of three to five years.
• President’s salary raised: The President, Vice President and Governors will now receive a respectable monthly salary of ₹5 lakh, 4 lakh and 3.5 lakh, respectively. Even Members of Parliament will now get double the salary at ₹1 lakh per month (2.5 lakh with perks) and expect the inflation-linked salary to be revised every five years.