Sitharaman’s budget: High expectations

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The Narendra Modi led Indian government is all set to present its first budget, after a global pandemic, on February 1 next. The pandemic and subsequent lockdowns have battered the Indian economy which is in serious need of a relief. The young people in the country are now the most suffering lot as far as the employment market is concerned. Higher job losses among those below the age of 40 years have resulted in an ageing workforce, which is not favourable for a strong recovery of the Indian economy, according to the Centre for Monitoring Indian Economy (CMIE). However, there are signs of recovery in the third quarter of the current fiscal and it may continue in the last quarter of 2020-21. These are, without a doubt, good signs but the disquieting fact is that this recovery is taking place with job cuts and no fresh employment. It is a job shrunk recovery and it affects mostly the young people and those who have just come out of colleges and universities to look for employment.

On the other hand, this is a precarious situation for the policy makers and as of now indications are that the Modi government in its eighth budget after it came to power still shall cling to the old policy of growth without caring for its job generation potential. The private investors are still not in a mood to invest as the demand level has not picked up to their expectations. The Government cannot depend on them for economic revival. In 2021, the centre has to take main responsibility for investment without caring for restricting fiscal deficit. The present situation calls for highly innovative programmes which will lead to substantial job generation in a planned manner. The entire emphasis has to ensure that while focusing on high technology, the labour intensive sectors get a big emphasis to absorb the burgeoning young labour force. Recent CMIE data said, “The share of the relatively young has correspondingly shrunk. This ageing of the workforce again, does not bode well for a stronger recovery in the second half of 2020-21 or in the future.” As per the CMIE, out of the 14.7 million jobs lost, 9.5 million were those of graduates and post-graduates. This is a very disquieting development.

Further, salaried employees who accounted for 21 per cent total employment in 2019-20, accounted for 71 per cent of the total job losses. Nearly 15 million less people were employed in December 2020 compared to those that were employed before the lockdown in 2019-20. Those who lost jobs were concentrated in urban regions, among women, among the relatively younger workers, the graduates and post graduates and the salaried employees. The fact is that both in slowdown and during lock down, the poor have been affected most, but the earnings of many big companies have gone up and also many rich have become richer. The slowdown and lock down have only widened the inequality in Indian society. The government may plan for a new India after five or ten years but for now all that the people want is the budget to be a vehicle for job oriented growth. That is the minimum that the people are looking for from Finance Minister Nirmala Sitharaman’s third budget.

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