Critical Analysis of Nirmala Sitharaman’s Budget Speech Post-2019

With the 2019 budget speech of Nirmala Sitharaman, a shift was observed in the financial policies of the Indian government. This year, the Modi government refrained from distributing populist freebies just before the elections, a significant deviation from previous practices. However, this budget speech raises several concerns regarding its effectiveness and impact on the Indian economy.

Public Expectations and Disappointment

Despite higher revenue under the Goods and Services Tax (GST), the government was expected to allocate increased funds for schemes like Kisan Samman Nidhi and for women farmers. Additionally, there was a hope for addressing the challenges faced by the Small and Medium Enterprises (MSME) sector, which employs over 12 crores people, as well as providing a stimulus for youth through capital investments. Instead, the focus seemed to be on increasing the capital expenditure (capex) to address rising unemployment and declining consumption. However, this strategy might lead to an increased fiscal deficit.

Evaluating the Determination and Long-term Impact

The government's determination to implement longer-term investment plans focused on education and health is commendable, even though immediate benefits might be limited. The long-term impact of such investments is likely to be profound, despite the challenges faced in the present budget. Critics argue that the benefits are more symbolic than practical.

Critique and Analysis

It is evident that the budget speech followed party directives, positioning it as an election-driven financial plan. Some have criticized the lack of substantial change and the continuation of policies that prioritize immediate benefits over structural reform. The focus on public sector disinvestment has also raised concerns. While the Bharatiya Janata Party (BJP) has historically promoted privatization, the current situation shows a significant shortfall in disinvestments, with potential implications for long-term economic stability.

Between 2014 and 2016, the government claimed significant achievements in turning around public sector units like BSNL, Railways, and PSUs in various sectors. However, the reality post-2019 paints a different picture, with many units reporting losses. This shift raises questions about the effectiveness of the government's current approach to public sector management. The disinvestment of key organizations such as BHEL, ONGC, and others, could result in complete control by private entities like the Ambanis and the Adanis. This raises concerns about the future of Indian industries and the potential loss of national competitiveness.

The Modi government's failure to manage these organizations effectively and the subsequent disinvestment plans have led many to question their competence. It is critical for the government to address these issues and take decisive action to ensure the long-term stability and growth of the Indian economy.

Conclusion

In conclusion, the 2019 budget speech by Nirmala Sitharaman exhibited a mixed bag of policies that combined immediate relief with long-term planning. While the goals are noble, the execution and overall effectiveness are open to debate. The current situation highlights the need for more robust public sector management and strategic disinvestment plans. The nation's economic future is at stake, and it is essential that the government takes actionable steps to address these challenges.