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Resource centre on India's rural distress
 
 

The Enormous Extra Spend In Budget Is An Illusion -Aunindyo Chakravarty

-NDTV blog

Nirmala Sitharaman said: "We have spent, we have spent and we have spent." She had every reason to claim that, since the budget numbers show that the centre spent 4.1 lakh crore, or 13 percent above what it had planned for last year. Additional spending will continue this year: expenditure is estimated to go up by 14.5 percent in 2021-2022 compared to last year, even though the government's revenue is expected to drop by 12 percent. That's why people are hailing it as an "expansionary" budget that will stimulate demand in the economy.

Economists and pundits have also praised the Finance Minister for coming clean on subsidies. It is an open secret that successive Finance Ministers have made their fiscal deficits look smaller by taking a chunk of food and fertilizer subsidies off the books - and asking Food Corporation of India (FCI) and fertiliser companies to borrow the rest. This year, Ms Sitharaman has decided to end that practice and account for the entire food subsidy in the budget itself.

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