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The consensus among senior politicians across parties and analysts is that chief minister Siddaramaiah is likely to present a populist budget. Photo: AFP
The consensus among senior politicians across parties and analysts is that chief minister Siddaramaiah is likely to present a populist budget. Photo: AFP

Will Siddaramaiah aim for a poll boost in budget?

Chief minister Siddaramaiah to present his government's last budget before Karnataka elections

Bengaluru: Karnataka chief minister Siddaramaiah will present on Friday his 13th and the Congress government’s last budget before assembly polls set to be held later this year.

The consensus among senior politicians across parties and analysts is that the chief minister is likely to present a populist budget with schemes to benefit backward classes, farmers and agriculture in order to retain power in a state where no party has been able to form the government on its own in subsequent elections for decades. A win is also likely to boost the party’s chances in next year’s Lok Sabha polls.

“In his record 13th Budget, CM @siddaramaiah is expected to announce a Budget the size of more than Rs. 2 Lakh crores. A historic first for Karnataka! #NavaKarnatakaBudget2018," the state unit of the Congress tweeted on Thursday.

If true, this would represent an increase of around 7.20% from last year’s budget of Rs1.86 trillion.

“It will be an election budget," a minister in Siddaramaiah’s government said, requesting not to be named. The higher allocation is expected to be used to announce special schemes for backward classes, agriculture, urban infrastructure and irrigation among other “poll positive programmes", he added.

“It’s going to be sops, sops, sops," said Harish Ramaswamy, political analyst and professor at the Karnatak University, Dharwad, pointing the populist themed budgets of Siddaramaiah during his term beginning 2013. The CM also holds the finance portfolio.

Populist schemes like Anna Bhagya (free rice), Ksheera Bhagya (free milk for students) and Arogya Bhagya (free healthcare) aimed at particular sections of society have seen Siddaramaiah’s popularity soar in recent months.

Opposition parties unsuccessfully tried to stop Siddaramaiah from presenting the budget months before elections, as it would have a direct impact on the polls.

The view that a populist budget necessarily translates into votes may, however, be exaggerated, analysts said.

The Bharatiya Janata Party (BJP) government in Karnataka presented a populist budget in February 2013, months before elections. But the BJP was reduced to 40 seats from 110, owing to factors such as infighting between top leaders, B.S.Yeddyurappa breaking away from the BJP in 2012 (he returned in 2013), illegal mining and a long list of corruption cases against many senior ministers.

Siddaramaiah and the Congress are hoping that its Rs8,165 crore farm loan waiver announced in June last year would help. However, similar announcements by other states like Maharashtra, Rajasthan and Madhya Pradesh have only added to fiscal pressures and not necessarily translate into electoral success, analysts said.

“If Siddaramaiah thinks of giving political colour to this (farm loan waiver), then reducing fiscal deficits will become a problem as it creates pressure groups who will continue to demand such sops in the future," Abdul Aziz, a visiting professor of economics and public policy at National Law School, Bengaluru, said.

The Janata Dal (Secular) and BJP have also promised to write off farm loans if voted to power.

Nevertheless, much of the capital expenditure is likely to go toward irrigation and improving rural infrastructure with a big share for Bengaluru, which accounts for 28 of the 224 seats, analysts said. The Congress government has announced several schemes for the city, including building 100,000 free houses for the urban poor and the metro.

Aziz said Siddaramaiah will continue his practice of presenting a “distributive budget" that will focus on creating social and physical infrastructure around his support base.

“It will be an AHINDA budget that seeks to create better social and physical infrastructure aimed at this section," Aziz said, referring to Siddaramaiah’s support base of minorities, backward classes and Dalits, which has shaped the Congress’s policies in the last five years.

Aziz also said Siddaramaiah is likely to keep the fiscal deficit to below 3%, lower than the national target of 3.3%.

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