- With the country scheduled to go for elections in 2024, the latest union budget was both a report card and an exercise to include those constituent groups that may have felt left out during the incumbent government’s rule from 2014 onwards.
- The fact that the budget has even spoken about neglected habitats such as wetlands is an achievement. These ubiquitous water bodies, in and around us in our cities and villages, have been under systematic neglect for over decades.
- In terms of semantics, green has arrived with this budget, indicating policy intent. However, for sustainable development to be sustained there is need for continuing action that is independent of the G20 presidency and electoral optics.
- The views in this commentary are that of the author.
For any government the first budget and the last one before the elections are important milestones. While the first one gives the initial indication as to how the government plans to turn electoral promises into reality, the last budget is usually the bugle call for the upcoming elections.
With the country scheduled to go for elections in 2024, the union budget presented by Finance Minister Nirmala Sitharaman on February 1, was both a report card and an exercise to include those constituent groups that may have felt left out during the National Democratic Alliance (NDA) government’s rule from 2014 onwards. Even though there will be a budget-like exercise in February 2024, it will not have the sweep of the current one since the national elections would most likely be scheduled on or before mid-2024.
The NDA government’s larger political messaging from the budget exercise of this week – consisting of the President’s Address, the Economic Survey and the budget speech – is one of presumed continuity. It is not just through the 2024 national elections but all the way up to 2047, when the country will celebrate the 100th year of Independence.
“By 2047, we have to build a nation that will be connected to the pride of the past and which will have all the golden chapters of modernity. We have to build an India that will be aatmanirbhar (self-reliant) and capable to fulfill its humanitarian duties,” said President Droupadi Murmu in her address. “This budget hopes to build on the foundation laid in the previous budget, and the blueprint drawn for India@100,” prefaced Sitharaman in the beginning of her speech.
Building on the green
The previous budget presented by Sitharaman in 2022 had, for the first time, many environmental or green concepts in it. The union budget this year has “green growth” as one of the four opportunities for India’s journey to 2047. It is also one of the seven priorities identified in the budget.
A whole host of new acronyms, related to green growth, were launched with the budget. The PM Programme for Restoration, Awareness, Nourishment and Amelioration of Mother Earth (PM-PRANAM) was announced for the use of alternative fertilisers; Galvanizing Organic Bio-Agro Resources Dhan (GOBARdhan) for promoting biogas technology; Mangrove Initiative for Shoreline Habitats & Tangible Incomes (MISHTI) for conservation of mangroves; and Amrit Dharohar for conserving wetlands.
These are in addition to Lifestyle for Environment (LIFE) initiative, which was launched by Prime Minister Narendra Modi during the Climate Change Conference of Parties in Glasgow, UK, in November 2021. LIFE, the budget speech states, can “spur a movement of environmentally conscious lifestyle.” This and India’s commitment to net zero by 2070 have been highlighted in the speech to refer to India’s role globally as a vishwaguru (world leader), since the country has the G20 presidency this year.
The other green initiatives include budgetary outlay for National Green Hydrogen Mission and for capital investments towards energy transition and net zero. There is also viability gap funding for battery storage facilities; inter-state transmission and evacuation of renewable energy from Ladakh; and for establishing 10,000 bio-input resource centres for helping farmers to adopt natural farming.
In terms of taxation, there is exemption of excise duty on GST-paid compressed biogas, and customs duty exemption for the import of capital goods and machinery needed to manufacture lithium-ion batteries for electric vehicles.
Infrastructure push
Like in the previous two years, the thrust in this budget is on infrastructure-led growth to “ramp up the virtuous cycle of investment and job growth.” Capital investment outlay is being increased to reach 3.3% of the GDP. This is complemented with increased outlay for railways, support for transport connectivity projects, and for development of airports.
There is the establishment of an Urban Infrastructure Development Fund for tier 2 and tier 3 cities. Cities will be supported for changing to sustainable cities of tomorrow, which, according to the budget, “means efficient use of land resources, adequate resources for urban infrastructure, transit-oriented development, enhanced availability and affordability of urban land, and opportunities for all.” Ultimately, cities will be incentivised to raise their own resources through municipal bonds.
In tourism, with the thrust on promoting domestic travel, the focus will be on developing integrated theme-based circuits and infrastructure in border villages. In the agricultural sector, the infrastructural support is for storage facilities.
Including those ignored earlier
If the dominant tone of the budget speech was on listing the achievements of the nine-year old NDA government, it also tried to make amends to those who had been neglected earlier. The section on the inclusive growth priority focuses mainly on farmers – a constituency that was at loggerheads with the national government over the farm laws and resorted to protest for months. Initiatives such as accelerator fund, digital public infrastructure, agricultural credit, support for fishing and cooperative societies have potential for benefiting farmers across the country.
For tribal communities left unsupported by the lukewarm implementation of the Forest Rights Act, there is an outlay of Rs. 150 billion (Rs 15,000 crores) for the development of facilities for the particularly vulnerable tribal groups. “This will saturate PVTG families and habitations with basic facilities such as safe housing, clean drinking water and sanitation, improved access to education, health and nutrition, road and telecom connectivity, and sustainable livelihood opportunities,” reads the document.
With loss of employment opportunities caused by a series of economic crises, starting with the demonetisation, GST implementation and then the COVID pandemic, there is disaffection among young people. The skill upgradation programme, launched to skill the youth, caters to this constituency.
Most important, the middle class that is the mainstay of support for the government, was given reduction in taxes through this budget. With lesser taxes, this class has more expendable money in its pockets.
Sweet and sour
Optics matter in politics. With the environment what you see is what the reality is. The fact that the budget has even spoken about neglected habitats such as wetlands is an achievement. These ubiquitous water bodies, in and around us in our cities and villages, have been under systematic neglect for over decades.
Though mangroves are also under pressure, they have not faced the policy neglect that the wetlands have faced. So, the mangrove conservation programme MISHTI (mishti is also the name of a sweet in Bengal) is more of a political outreach to the people of West Bengal through the Sundarbans.
The millet programme can specifically help farmers in the rain fed tracts. The protests against the farm laws were mainly led by the farmers of the irrigated tracts of the Indo-Gangetic plains. Thus, while support for millets can be viewed as a reach out to those whose participation was less in the protests, it will also help give support to the geographical areas that were left untouched by the Green Revolution.
The Green Revolution was a package of measures designed starting the mid-1960s to overcome the ship-to-mouth food situation. It supported the irrigated tract farmers with better seeds, fertilisers, pesticides and credit to increase their production and productivity. While this intensive support helped India become food surplus, it led to the neglect of rain fed areas vis-à-vis the irrigated tracts. This meant, then, that two-thirds of the areas were neglected. Though over the years more and more rain fed lands have come under irrigation, it still constitutes a half of all agricultural land in the country.
Situated mostly in the semi-arid tracts of central India, the millet-growing lands are also vulnerable to climate shocks. So, support for farmers of these areas can add to their climate resilience.
However, the support needs to be long standing, rather than a flash in the pan during the International Year of Millets. In this context, the cut in rural employment funds under the Mahatma Gandhi National Rural Employment Guarantee Scheme becomes counterproductive. The soil and water conservation activities that this scheme supports are essential for building climate resilience in the water-deficit millet growing areas.
The thrust on infrastructure development is also a double-edged sword. Projects that are not well thought through and implemented – including those related to renewable energy – can do irreparable damage to the environment. This is especially so when the government has had a track record of diluting environmental regulations, and when environmental impact assessments are perfunctory and compensatory afforestation cannot replace the ecosystem importance of natural forests.
In terms of semantics, green has arrived with this budget, indicating policy intent. However, for sustainable development to be sustained there is need for continuing action that is independent of the G20 presidency and electoral optics. That would be a test into Amrit Kaal.
Read more: Fifty shades of green: The union budget’s environmental hits and misses
Banner image: Coal mines in Lakhanpur. Green initiatives in the 2023 budget include budgetary outlay for capital investments towards energy transition and net zero. Photo by India Water Portal/Flickr.