New Delhi: The Union government in its 2008 Budget emphasized fiscal responsibility and made modest hikes in grants for irrigation, health and education—three high-priority areas for the ruling United Progressive Alliance (UPA)—but left some of its own ministries disappointed.
As the country prepares for elections in 2009, finance minister P. Chidambaram stressed benefits for a range of basic needs, such as child nutrition, clean drinking water and employment, and said state governments must spend these resources wisely and monitor projects more closely.
The government will initially provide Rs16,000 crore to the National Rural Employment Guarantee Scheme (NREGS) and has promised to implement it in all 596 rural districts in the country. “Let there be no apprehension in anyone’s mind—as demand rises, more money will be provided to meet the legal guarantee of employment,” Chidambaram said in his speech.
Ambika Soni, Union minister for tourism and culture, said the increased allocation for all flagship programmes such as Bharat Nirman and NREGS is in keeping with the government’s inclusive growth policy. “So, this is truly a budget of consolidation,” she said.
The increase in allocations is still lower that what some of the ministries had demanded. For instance, the ministry of human resource development had asked for about Rs20,000 crore more than it has got from the Budget. The total allocation is Rs32,000 crore while the demand was Rs53,000 crore.
The rural development ministry had asked for Rs10,000 crore more than the proposed increases, despite a 33% increase in allocation for NREGS alone. This scheme promises 100 days of minimum wage employment to one member of poor families in rural areas.
Nevertheless, the Budget has apportioned 23% more to the Sarva Shiksha Abhiyan, a primary education programme. The Mid-Day Meal Scheme, for providing lunches to around 11 crore schoolchildren, will get 10% more than last year.
The Bharatiya Janata Party, the lead opposition party, said it was decidedly unhappy with the grants. “We don’t think this is going to help,” said Yashwant Sinha, former finance minister and BJP leader. “Not only has the government excused itself, for a second time, from fiscal responsibility targets, it has failed to allocate 3% of the Budget’s resources for education. So, it is not living up to its own promises.”
Sitaram Yechury, a senior member of the Communist Party of India (Marxist), said the allocations for major projects appear inadequate and half-hearted. “If you look at the fine print on allocations for education, irrigation and health, you’ll find that there are very, very nominal increases, or actual decreases. That’s because this Budget is meant to contain deficit rather than fuel growth,” he said.
The Budget promises safe drinking water in schools and introduces a new component under the Rajiv Gandhi Drinking Water Mission to raise allocation by 12% for it. The scheme is only for areas where the quality of water has fallen or where safe drinking water is not available. “Our children should get safe drinking water,” Chidambaram said.
The allocation for the Integrated Child Development Scheme, which provides nutritious cooked meals to children, 45% of whom are in the 6-month to 3-year age group and malnourished, is 19% higher than in 2007-08.
Individual ministries wanted more for priority programmes, but the latest data shows that most states fell behind in executing projects. Performance and execution determines allocations, Chidambaram’s speech suggested on Friday.
For instance, only 35% of NREGS’ Rs12,000 crore in 2007-08 was asked for by states by 24 January.
For the Indira Awas Yojana and Pradhan Mantri Gram Sadak Yojana, only 23% and 50% of respective allocations were made by then.
Ashish Sharma also contributed to this story.