Union Budget 2023: A Budget for Middle Class, but what more can we do for the poor?

Date:

Trending

The Union Budget 2023 has given significant relief to the middle classes; however, India’s vast majorities of working people in rural areas and the cities need more focused attention.

- Advertisement -

We may have come out of the COVID-19 pandemic, but the precarity of employment continues. The Periodic Labour Force Survey (PLFS) and other data indicate high levels of unemployment, particularly among youth, continued precarity, and constrained household consumption.

Given this, peasants and informal workers of India expected that MGNREGA allocations would at least, if not more, see an allocation of Rs two lakh crores. But, instead, the outlay has been reduced even further to Rs 60,000 crores, which will reduce employment days available, let alone solve the question of payment of pending wages.

- Advertisement -

With high inflation levels, food support could have significantly relieved most Indian households. However, the allocation to food subsidy has seen a major decrease from Rs 2.87 lakh crore in the revised estimate of 2022-23 to 1.97 lakh crore in this year’s Budget.

The withdrawal of the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY), and its provision of an extra five kilograms of free food grains to every ration card holder in addition to the entitlement under the National Food Security Act, would put an additional burden on poorer households.

Peasants and informal workers were hoping for dignified social security after the registration under e-Shram However these hopes are denied due to stagnating outlays under the National Social Assistance Programme and Ayushman Bharat and the reduction of allocation for Social Security of Workers from Rs 15,845 crore in the last Budget to Rs 12,434 crore in this budget.

India must close the global gap regarding its social protection expenditure as a percentage of its GDP. India spent only 1.4 percent of its GDP vis-a-vis the global figure of 13 percent in 2020. Only 24.4% of India’s population is covered by at least one social security scheme (excluding healthcare), and 55% are covered under universal health coverage. In such a situation, a higher allocation of social security was expected.

Investing in agri-tech infrastructure and digitizing PACS are welcome steps that make this budget innovative and creative. Agriculture remains to be the largest employer at 46.5% of the workforce and has increased marginally from 2019-20 to 2020-21.

In the view of contracted agricultural growth as per the economic survey, the headwinds the agricultural sector is facing on account of climate change, inflation, and reduction in subsidies, more focus and priority should be given to millions of farming households through the way of greater financial subsidies. Moreover, the question of landless agricultural workers remains with no focus on their protection and welfare.

Expectations were high for assistance under PM Kisan Samman Nidhi to be increased to Rs 8,000 per year; instead, the budget outlays for the scheme have been further reduced.
In times of rising extreme weather events and climate change, price support, fertilizer subsidies, and crop insurance act as safety valves for India’s farmers and agricultural workers. However, this budget has reduced allocations to the PM Fasal Bima Yojana, schemes for minimum support prices for crop procurement, and the fertilizer subsidies being provided.

We welcome the renewed impetus for the development of Particularly Vulnerable Tribal Groups (PVTGs). Allocation of Rs 15,000 crore for developing basic facilities like safe housing, clean drinking water, and improved access to education and health of PVTGs communities is a welcome step to address the needs and futures of PVTGs.

However, what is missed is the longstanding demand for a similar budgetary allocation enhancement for members of semi-nomadic, nomadic, pastoral, and de-notified tribes, comprising 13% of the population, who have historically been at the end of stigmatization, ostracism, and discrimination. The allocation of 40 crores to the Scheme for Economic Empowerment of DNT/NT/SNTs (SEED) is highly insufficient.

The announcement to end the oppressing and inhumane practice of manual scavenging with 100% mechanical desludging of septic tanks and sewers in cities from “manhole to machine-hole” mode is another welcome step. However, the zero allocation to the ‘Self Employment Scheme for Rehabilitation of Manual Scavengers’ is a detrimental step.

The Honourable Finance Minister’s announcement to support poor prisoners who cannot afford bail amount or penalty is welcome. We hope such support will also be provided to the majority of the undertrials, who are from poor and discriminated communities.

The initiative of green growth and transition to net-zero carbon and several focused proposals are welcome steps. These include the National Green Hydrogen Mission, capital investments towards net-zero, and MISHTI – the Mangrove Initiative and Amrit Dharovar. Under the latter, recognizing local communities as frontline ecological defenders is worth celebrating.

Similarly, the initiative to promote millets in the food security program and providing input support through GOBARdhan and PM-PRANAM is a welcome first step. However, the longstanding demand is to expand the public procurement of millet under the National Food Security Act above the current rate of 1%. In that spirit, this could have been incentivized by providing price support to cultivators through the ecological valuation of climate-resilient agriculture.

In this regard, what is missed is the compensation for the impact that frontline communities such as farmers, pastoralists, fish workers, and urban informal workers are facing on climate change.

India suffered the second highest loss due to extreme climate events in 2021, racking up nearly $7.6 billion in damages due to flooding and storms, according to the latest report- The State of Climate in Asia 2021, by the World Meteorological Organization and the UN Economic and Social Commission for Asia and the Pacific (ESCAP).

Moreover, a World Bank report suggests that by 2030, India may account for 34 million of the projected 80 million global job losses from heat stress-associated productivity decline. In such a situation, budgetary allocation for a national loss and damage financing facility would have been a game changer.

The increased allocations to higher education are a significant investment in India’s future. However, the education expenditure has increased marginally from 2.8% to 2.9% of GDP from 2019 to 2023.

The Samagra Shiksha Abhiyan has been provided Rs 37,453 crore, almost identical to last year. On the other hand, PM-POSHAN, which provides nutrition to children in school and anganwadi centers, has seen a reduction in allocation compared to the revised estimates for the ongoing financial year.

The latest NFHS-V statistics still mark stunting at 35.5%, wasting at 19.3%, and underweight prevalence at 32.1% for children below five years, so expectations for more significant allocations were high. It is also worrying that allotment to education empowerment for minorities has reduced significantly from Rs 2,515 crore in the last budget to Rs 1,689 crore in this one.

The announcement for focusing on eradicating sickle cell anemia, which plagues the large population of India’s indigenous communities, is a step in the right direction.

However, according to the Union Ministry of Health & Family Welfare’s Rural Health Statistics 2021-2022, India’s rural healthcare system continues to be plagued by a shortfall on two critical fronts – doctors and infrastructure.

While the increase in health expenditure between 2019 and 2023 from 1.4% to 2.1% of GDP and higher allocation for digital health missions is another forward-looking step, expectations were high for more expenditure on the National Health Mission and health infrastructure development.

In sum, while the Budget has prioritized inclusive development, as the Honourable Finance Minister mentioned in her budget speech, the financial outlay for ensuring it does not show the zeal as hoped.

The Finance Minister has announced that Rs. 35,000 crore revenue would be forgone due to a reduction in personal income taxes, and while a relief to the middle classes is welcome, fiscal prudence is not enough to expand public employment, social security, welfare, education, and health expenditures considerably.

The need of the hour is to raise revenues through the reduction of revenues forgone and innovative mechanisms such as wealth tax on super accumulation of wealth.

THE SNAPSHOTS

Sign up to get quick snaps of everyday happening, directly in your inbox.

We don’t spam! Read our privacy policy for more info.

- Advertisement -

Support our independent journalism PayPal (Outside India) For PayU (For Indian Readers).

Sandeep Chachra
Sandeep Chachrahttps://www.actionaidindia.org/
Sandeep Chachra, Executive Director, Action Aid.

More Latest Stories

More Articles

Construction Jobs Expo 2025: RDS Arena, Dublin, Ireland

If you look at the statistics for recent years, you can see that the fastest-growing and most promising industry is construction. There are many...

Shadow AI: What SMEs Need to Know About the Hidden Risks of Free AI Tools

These days many small and medium-sized enterprises (SMEs) are rapidly implementing AI in a business environment that requires quick trailblazing in order to boost productivity and simplify business activities. The benefits of AI are enormous with the potential of introducing automation to improved decision...

Navigating the Complexities of EV Fleet Financing and Leasing Options in India

As India's transportation sector accelerates towards electrification, the shift from internal combustion engine (ICE)...

Leading Through Uncertainty: Lessons from Building in a Rapidly Evolving Tech Landscape

In the enterprise tech space, uncertainty is no longer the exception—it is the status...

Ankur Vij of Techjockey on B2B Software Buying Shifts, AI Trends, and Market Expansion

In a conversation with TechGraph, Ankur Vij, Senior Vice President of Business Growth at...

US Senate rejects bid to limit Prez. Trump on Iran Strikes

The Republican-led U.S. Senate on Friday rejected a Democratic-led effort to block President Donald...

Complete Guide to Playing the World’s Biggest Lotteries from India

Have you ever dreamed of winning massive jackpots from legendary lotteries like Powerball, EuroMillions,...

Cryptocurrencies and the Lottery World: A New Era with LottoPark

The world of lotteries has long been associated with excitement, dreams of fortune, and...

How is AI being used to detect unusual customer behavior & fraudulent transactions in real-time?

In an era of hyper-digital transactions and global commerce, it has been more difficult to detect fraud. Traditional rule-based systems simply cannot keep up...

Social Casino Compliance in 2025: Legal Loopholes, Tech, and Marketing Limits

The sweepstakes and social casino industry operates in a complex and changing legal environment....

How APIs Are Redefining the Future of Digital Products

The way software is built has undergone significant changes. Users expect real-time experiences. Developers...

Air India Plane Crash: Over 60 victims identified via DNA

Days after Air India’s Ahmedabad-to-London flight crashed with 242 passengers and crew on board,...

Consumer Expectations vs. Delivery Reality: The Real Challenges of Food Delivery Platforms

Getting food delivered at the doorstep has completely changed how people eat and live....

Why data breaches are getting costlier in India

A data breach occurs when unauthorized individuals gain access to confidential or sensitive information, compromising the integrity and security of an individual or a...

Intel Report: Iran’s Nuclear Progress Delayed but Not Destroyed by US Strikes

A day after the ceasefire between Israel and Iran, striking revelations have emerged from a preliminary U.S. intelligence assessment regarding the recent U.S. airstrikes on Iranian nuclear sites. The report suggests that the strikes did not destroy Iran’s nuclear capability but merely set it...

Nvidia CEO Jensen Huang Files to Sell $7.35 Million in Stock

Nvidia Corporation, CEO and President Jensen Huang has filed a notice with the U.S....

Mark Zuckerberg Files to Sell Meta Stocks Worth $9.78 Million

Meta Platforms CEO and chairman Mark Zuckerberg has filed a Form 144 with the...

GW Casino Review & FAQ: Real Talk for Aussie Punters

With the avalanche of cookie-cutter online casinos hitting Aussie screens, most punters have seen...

Finding the Right Custom Home Builder in Bay City: Reviews & Recommendations

Building a new home is one of life’s most exciting milestones—but it also comes...

Pichai Family Foundation to Sell 4,000 Alphabet Shares Worth $708K

The Pichai Family Foundation filed a notice with the U.S. Securities and Exchange Commission...

Sundar Pichai Sales Alphabet Stock Worth $5.6 Million

Alphabet Inc. (NASDAQ: GOOGL) CEO Sundar Pichai filed a notice with the U.S. Securities...

36 Bangladeshi Nationals Held Without Visas in Delhi

The Delhi Police has apprehended 36 Bangladeshi nationals residing illegally in India. The dedicated...

Congo: Over 29 dead as floods, landslides hit Kinshasa

At least 29 people died in Kinshasa after heavy rains over the weekend triggered...

Security Forces Deploy Facial Recognition Tech on Pahalgam Route to Secure Shri Amarnath Yatra

Jammu and Kashmir: In a first-of-its-kind move, security forces have installed advanced facial recognition...

Air India Plane Crash: Over 60 victims identified via DNA

Days after Air India’s Ahmedabad-to-London flight crashed with 242 passengers and crew on board,...

NVIDIA CEO Jensen Huang Files to Sell 50,000 Shares

NVIDIA Corporation CEO Jensen Huang filed a Form 144 notice with the U.S. Securities...

Chan Zuckerberg Initiative Sells Meta Shares Worth $17.8 Million

The Chan Zuckerberg Initiative Foundation sold 25,302 shares of Meta Platforms Inc. between June...

IAEA expresses ‘serious concern’ after US strikes on Iran

In response to U.S. airstrikes on Iranian nuclear facilities, the head of the International...

Iran pledges decisive action after US airstrikes on nuclear sites

An emergency meeting of the International Atomic Energy Agency (IAEA) was convened in Vienna...

Consumer Expectations vs. Delivery Reality: The Real Challenges of Food Delivery Platforms

Getting food delivered at the doorstep has completely changed how people eat and live....

Congo: Over 29 dead as floods, landslides hit Kinshasa

At least 29 people died in Kinshasa after heavy rains over the weekend triggered...

Sharp Bettors vs Recreational Bettors: What Sets Them Apart?

In the U.S. alone, over $120 billion was legally wagered on sports in 2023,...

Security Forces Deploy Facial Recognition Tech on Pahalgam Route to Secure Shri Amarnath Yatra

Jammu and Kashmir: In a first-of-its-kind move, security forces have installed advanced facial recognition...