Karnataka’s new government unveiled a please-all budget Thursday with an eye on the next general election, ranging from measures to tackle road congestion in the capital Bangalore to free electricity for farmers and lower local levies for industry. The agriculture sector accounts for 37% of the total electricity consumption in the state and the power subsidy would cost Rs2,050 crore this fiscal.
Since assuming office after elections in May for the first time in a southern Indian state, Chief Minister B.S.Yeddyurappa’s Bharatiya Janata Party (BJP) government has been beset by a fertilizer shortage that caused violent protests by farmers, acute power scarcity and a drought-like situation triggered by weak monsoon rains. While Yeddyurappa called his budget Rs.pro-farmer’, he also announced an allocation of Rs1,800 crore for infrastructure development in Bangalore, which accounts for 60% of the state domestic product.
Value added tax and stamp duty rates were simplified to benefit industry. “I have implemented more than 95% of the (election) promises I made,” said Yeddyurappa, who also holds the finance portfolio. Some analysts linked the populist budget to the next parliamentary elections, which are due to be held by May next year but which may be called sooner. “The BJP may be sounding the election bugle through the budget,” said Sandeep Shastri, a Bangalore-based political analyst. “Generally, assembly or parliamentary elections are a reaction to local issues,” he added.