Union Budget 2023: Finance Minister Nirmala Sitharaman is geared up for presenting her fifth budget in the Parliament on Wednesday (February 1). All eyes are on her budget speech in which she will reveal who will get what from the Union budget. Politically, it is very crucial for the Modi government as it is the last full-fledged budget before the General Elections slated to be held in 2024.
Budget 2023 will be ray of hope for world, says PM Modi
Prime Minister Narendra Modi on Tuesday said amid global economic turmoil, India’s budget will attempt to meet the hopes and aspirations of common citizens and be a ray of hope for the world.
Addressing the media ahead of the Budget Session of Parliament, Modi said recognised voices in the world of economy were bringing positive messages from all sides.
The prime minister said the Budget will strive to fulfil people's hopes, aspirations and also boost the hopes with which the world is looking at India.
Also Read: Economic Survey 2023 key highlights: Borrowing rate stays high, GDP to grow at 6-6.8%
"The ray of hope being seen by the world will glow brighter -- for this, I firmly believe the finance minister will make all efforts to meet these aspirations," Modi said.
He also noted that President Droupadi Murmu was delivering her maiden address to the joint sitting of Parliament at the start of the Budget Session.
The President's speech is the pride of the Constitution of India, the pride of India's parliamentary system, and also an opportunity to respect women and the great tribal traditions of the country, Modi said.
According to the parliamentary traditions evolved over the last six to seven decades, a parliamentarian speaking for the first time in the House, belonging to any political party, is extended respect and a conducive atmosphere is created to enhance his/her confidence, the prime minister said.
"This is a rich and best tradition. It is the responsibility of parliamentarians to ensure that this moment of the President's first address to Parliament is full of enthusiasm, warmth and energy. I am sure our Parliamentarians will pass this test," the prime minister said.
What India Inc expect from the Union Budget
The Economic Survey 2022-23 tabled in Parliament on Tuesday presents a realistic assessment of India's economy, industry bodies said, while expressing hope for out-of-box measures to boost growth and consumption in the upcoming Union Budget. India's economy is projected to slow to 6.5 per cent in the fiscal year starting April but will remain the fastest growing major economy in the world as it fared better in dealing with the extraordinary set of challenges the globe has faced, said the Survey. Chandrajit Banerjee, Director General, CII, said the Survey effectively analyses and captures the prevailing trends across all major sectors of the economy which could form a pivot for deliberations on the future course of the economy.
"CII hopes that some of the perceptions and ideas in the survey would find a place in the Union Budget to be presented tomorrow," he added.
Subhrakant Panda, President, Ficci, said to ensure that the growth momentum continues, continuous support will be needed throughout the year from the government.
"We are hopeful that the Union Budget will continue to lay major thrust on capex including physical, digital as well as social infrastructure; this will help crowd-in private investments, which has already started to show an uptick," he added.
Assocham Secretary General Deepak Sood said the Economic Survey is a realistic assessment of the Indian economy listing out challenges and opportunities in the context of a difficult global economy marked by high inflation, impact of Ukraine-Russia war and stringent monetary tightening by the major central banks.
Budget should focus on falling imports, slowdown: Ex-Finance Minister Chidambaram
Senior Congress leader and former Union finance minister P Chidambaram said that the BJP-led central government in its upcoming budget should focus on addressing issues like the impact of the global slowdown on economic growth, falling exports, increase in the current account deficit (CAD) and mounting total government debt.
He said that the Union Budget should also focus on the danger of falling consumption leading to lower standards of living due to high unemployment rate, layoffs and inflation.
"I have great expectations but, going by past experience with the NDA’s budgets, I am also prepared for great disappointment. Objectively, the budget for 2023-24 (the last full budget should address the current weaknesses of the economy. They are the impact of a global slowdown on economic growth in 2023-24; sluggish private investment; falling exports; increase in the current account deficit; mounting total government debt; and, above all, because of the high unemployment rate and layoffs and inflation, the danger of falling consumption leading to lower standards of living," he added.
Jobs remain elusive, quality employment even more
Sanjay Maiti, 43, is hurrying down Kolkata’s Burrabazar to reach the small firm, whose accounts ledger he prepares after handling cash at an eatery off Strand Road. After losing his job as an accountant in a metal works in Howrah, soon after the Covid pandemic broke out three years back, and a period of being cooped up in his two-room flat near Posta market during the lockdown, he had landed first the part-time work at the wholesaler firm dealing in gunny bags and then the cash counter at the eatery.
“I juggle two jobs now… and earn about the same money that I was getting at the metal works...but my quality of work life has gone down. Longer working hours, no safety net for health or old age,” said Maiti (surname has been changed to protect his identity).
Maiti is not the only one complaining. As the economy slowly picks up after the pandemic-induced business meltdown, jobs are trickling into the market but their quality is often patchy, as most of them are in the informal sector.
At the same time with population growth and more new entrants joining the job market jostling with those who lost work during the pandemic, job opportunities are still too few and far between.
“Growth is being driven mostly by large corporates who have recovered from two years of COVID-19, but the micro, small and medium enterprises (MSME) or the semi-formal sector is part dead and in part hasn’t recovered from the double whammy of demonetisation and the pandemic,” explained Dr Pronab Sen, noted economist and former chairman of the National Statistical Commission.
The MSME sector accounts for three out of four formal sector jobs in India. The bitter fact, analysts say is that closure or scaling down of operations of many MSMEs has affected many more workers like Maiti.
Economists pointed out that unemployment which used to be under 3 per cent in 2011-12 and about 6 per cent in 2017-18, is now hovering near 8 per cent.
Data compiled by the Centre for Monitoring Indian Economy seems to indicate unemployment has risen from 6.6 per cent in January last year to 8.3 per cent in December 2022. However, this dipped by a tad to 7.
1 per cent as on January 29, although urban unemployment remained high at 8.6 per cent.
In eastern India, unemployment remained high at 19. 1 per cent in Bihar, with Jharkhand standing neck-to-neck at 18 per cent for December 2022. West Bengal reported a far lower figure of 5.5 per cent, but economists say this is partly because of the success of its rural jobs programme, which had 10.33 million active workers, besides "export" of construction labour to other states.
“There is greater formalisation of the economy on the one hand and a rise in the informal sector… in the process, the MSMEs have been squeezed out and that is what has hit the job market and the quality of jobs,” said Dr Sen. The problem, economists suspect, is that with the withering of the MSME sector, urban unemployment has been rising. The last National Sample Survey on MSMEs was done in 2015-16, and it showed the number employed by this sector was a whopping 110 million. Economists fear the number of jobs in the sector has shrunk by 10-15 per cent since then, though the numbers are not available, as the NSSO has not compiled any data since 2016.
(With PTI inuput)
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