Annual Series of Thematic Deliberations on Union Interim Budget 2024-25: Day 1 of Budget Discussions

Event Report
Priyanka Negi

The IMPRI Center for the Study of Finance and Economics (CSFE) and the Gender Impact Studies Center (GISC) recently organized an insightful panel discussion on the theme “Gender, Social Inclusion and Interim Union Budget 2024-25” and “General Election and Interim Union Budget 2024-25” as part of the IMPRI 4th Annual Series of Thematic Deliberations on Union Budget 2024-25. This virtual events, held on February 2, 2024, brought together prominent experts to delve into the implications of the interim budget on various facets of the Indian economy.

Gender, Social Inclusion and Interim Union Budget 2024-25

As the Chair and Moderator of the discussion, Professor Vibhuti Patel, Visiting Distinguished Professor at IMPRI, provided a comprehensive analysis of the budget. Notably, this year’s budget witnessed an escalation in capital expenditure, aligning with the trend observed in the previous interim budget, albeit with a diminished emphasis on the social sector. Professor Vibhuti Patel drew attention to a notable reduction in social welfare schemes like Poshan Abhiyaan, National Education Scheme, MGNREGA, and NSAP, marking a shift in the budgetary priorities.

Professor Vibhuti Patel underscored four pivotal concerns within the gender and social sectors, emphasizing the pressing issues of youth unemployment, the low work participation rate of women, food inflation, and agrarian distress. Furthermore, she highlighted the discrepancy between gender commitments and corresponding financial allocations within the current neo-liberal economic framework. The data shared by Professor Vibhuti Patel, based on the International Labour Organisation’s ‘World Social Protection Report,’ indicated that only 25 percent of Indians are covered by a single social security scheme. In contrast, countries with lower economic standings in the Asia Pacific region exhibit a higher coverage of around 44 percent under social security schemes, emphasizing the need for more comprehensive social protection measures.

Dr. Paramita Majumdar, serving as an Independent Consultant, played a crucial role in advancing the discussion by delving into the trajectory of gender-responsive budgeting in India since 2005 and offering insights into the current Interim Budget. Emphasizing the need for a collaborative effort, she underscored the importance of the planning, finance, and social development departments of the Government of India working collectively to ensure the success of gender-responsive budgeting initiatives.

Dr. Majumdar noted positive developments since 2005, with improvements in gender budgeting reflected through the submission of statements, advisories, and audits by various ministries. The institutionalization of gender budgeting was acknowledged as a commendable step forward. However, Dr. Majumdar highlighted the imperative for a targeted focus on aspects such as allocation and implementation, along with investing in training and research initiatives to further strengthen gender-responsive budgeting mechanisms in the country.

In summary, Dr. Paramita Majumdar’s takeaways underscored the progress made in gender budgeting since 2005 while drawing attention to the areas that demand concentrated efforts to enhance the effectiveness and impact of gender-responsive budgeting practices in India.

In her opening remarks, Prof N. Manimekalai, the Founder and Director of the Department of Women’s Studies, provided a nuanced perspective as an economist specializing in women’s studies, focusing on the macroeconomic framework influencing the 2024-25 interim budget. Drawing from her research in Tamil Nadu and Kerala, she observed a marginal increase in the budget allocated to the women and child development sector. In contrast, she highlighted a concerning decline of 7 percent for the Ministry of Education and a stagnation in the budget allocated for rural development.

Prof N. Manimekalai engaged in a critical reflection on various schemes related to nutrition, education, unemployment, housing, occupational diversification, self-employment, and ad hocism. She underscored the gap between the announcement and effective implementation of these schemes. Additionally, she brought attention to the precarious conditions faced by workers in the economic sector. On a sub-national level, Prof N. Manimekalai discussed seven noteworthy best practices, spanning education, mobility, free bus services, reproductive health issues, the gender action plan, and the direct empowerment of self-help groups by the state, advocating for a more inclusive and effective approach to socio-economic development.

In advancing the discourse, Dr. Neha Shah, Associate Professor at LJ University, directed attention towards the equity and justice considerations embedded in the budget. She underscored the formidable challenges confronting 40% of Indian youth grappling with unemployment, the alarmingly low participation of women in the workforce, and the erosion of the survival base for rural and tribal populations within the informal sector.

Dr. Shah expressed apprehensions about the dissonance between the budget’s allocated funds and the diminished expenditure in crucial areas such as education, health, and welfare schemes for Scheduled Castes (SCs) and Scheduled Tribes (STs). She raised concerns over the privatization of education, the dearth of essential skills among the youth, and the meager labor participation of women. Dr. Shah advocated for a concentrated focus on education, fostering a quality care economy, fortifying the old-age support system, and implementing benefits like maternity leave, asserting that these areas should be pivotal considerations reflected in the national budget.

In the subsequent panel, Dr. Sanghamitra Dhar, serving as the Coordinator/Programme Lead for Gender Responsive Budgeting at UN Women India, offered valuable insights into the pivotal role played by UN Women in fostering gender-responsive budgets at both national and sub-national levels. Dr. Dhar elucidated the nuanced distinction between gender-responsive and gender-transformative budgets, shedding light on the comprehensive approach advocated by UN Women.

As a strategic partner of the nodal ministry (Women and Child Development), UN Women extends technical assistance at the budgetary level, contributing to the integration of gender considerations into fiscal policies. Dr. Dhar expressed encouragement at the increased participation, noting that 38 ministries reported for Gender Responsive Budgeting (GBS) during this period. Furthermore, she highlighted positive developments, particularly in states like Maharashtra, where transgender issues have been inclusively incorporated into the GBS framework.

Dr. Sanghamitra Dhar’s takeaways underscored the progress and impact of UN Women’s initiatives in promoting gender-responsive budgeting, emphasizing the need for continued collaboration and improvements in mainstreaming transgender concerns across diverse regions.

In the subsequent segment, Maya Awasthy, an advocate and Trans-Activist, enriched the discussion by offering an on-the-ground perspective. According to her, the imperative of the hour is a gender-neutral budget that caters to the diverse needs of the community. Maya highlighted a concerning trend: the dwindling utilization of budgetary allocations earmarked for the transgender community. Illustrating her point, she referenced the SMILE (Support for Marginalised Individuals for Livelihood and Enterprise) scheme, where a noticeable disparity emerged between the allocated budget and the actual expenditure. Maya emphasized the critical importance of directing attention toward both financial allocation and effective policy implementation, underscoring that these areas should be the focal points for governmental efforts.

Maya Awasthy’s insights underscored the urgency for a more inclusive fiscal approach, advocating for a gender-neutral budget that aligns with the specific requirements of the transgender community. Her practical examples shed light on the necessity for transparent financial allocation and meticulous policy execution to address the unique challenges faced by marginalized groups.

Post the insightful discussion on the budget, Shri Shailesh Mishra, the Founder and President of the Silver Innings Group, contributed a perspective focused on an inclusive and elder-friendly budget. He brought attention to the longstanding issue of senior citizens being consistently overlooked in budgetary considerations.

According to Shri Mishra, a staggering 90 percent of the elderly population lacks adequate social security measures. He emphasized the imperative for ‘Sabka Saath, Sabka Vikas’ (Together with All, Development for All) to encompass and prioritize the elderly demographic. Shri Mishra stressed that the imperative lies not only in the formulation of the budget but also in the comprehensive development and actual implementation of policies that cater to the needs and well-being of the elderly, highlighting the essential need for age equality in the societal and fiscal discourse.

Shri Shailesh Mishra’s insights underscored the critical necessity for a paradigm shift in acknowledging and addressing the challenges faced by the elderly population. His call for an age-inclusive budget highlighted the broader societal commitment required to ensure the well-being and dignity of senior citizens, emphasizing the need for both policy formulation and effective implementation to achieve age equality.

In the concluding segment, Ms. Deepa Pawar, the youngest panelist and Managing Trustee & Founder Director of Anubhuti, provided a thoughtful reflection on the budget’s impact on Scheduled Castes (SCs) and Scheduled Tribes (STs). With a focus on these marginalized communities, she underscored the importance of a comprehensive approach. Ms. Pawar emphasized the need for an accurate census, ensuring the genuine utilization of budgetary allocations, fostering inclusivity in the budget’s character, and promoting budgetary literacy. Her insights shed light on the multifaceted challenges faced by SCs and STs, and she advocated for a holistic and informed approach that addresses their unique needs and circumstances.

Ms. Deepa Pawar’s takeaways encapsulated a call for proactive measures to ensure the effective utilization of budgetary resources for the benefit of SCs and STs. Her emphasis on an inclusive and informed budgetary process echoed the broader goal of addressing the specific concerns and challenges faced by these communities, aligning with the principles of equity and social justice.

In summary, the discussion provided a multifaceted exploration of India’s Interim Union Budget for 2024-25, uncovering key insights into fiscal policies’ impact on diverse segments of the population. The analysis highlighted concerns such as reduced emphasis on social welfare schemes, gender and social sector disparities, challenges in gender-responsive budgeting, and the need for comprehensive approaches to address issues ranging from youth unemployment to the neglect of senior citizens.

The discourse underscored the imperative for transparent allocation and effective implementation of budgetary measures, fostering inclusivity, and prioritizing marginalized communities. The collective insights called for a paradigm shift towards age equality, gender-neutral budgets, and informed fiscal practices, emphasizing the essential role of policies in achieving equity, justice, and the overall well-being of the populace.

General Election and Interim Union Budget 2024-25

Prof Nilanjan Banik, the Chair of the budget panel discussion, provided insights into the growth trajectory of the Indian economy and its future prospects. His overview emphasized the positive trends in manufacturing, controlled inflation, and fiscal deficit. Notably, he highlighted the increasing working-age population, supported by an analysis of the Periodic Labour Force Survey data. Prof Banik’s takeaways centered on the optimistic aspects of the economy, with particular attention to manufacturing growth and demographic trends, setting the stage for a comprehensive exploration of the budget’s implications.

Professor Anurag Banerjee, a distinguished expert in Financial Econometrics from Durham University, delved into the budget’s implications for lower and middle-class sectors. His insights revolved around a thorough examination of the composition of lower-income demographics within the economy, shedding light on the profound impact of inequality on overall growth rates. Professor Banerjee’s takeaways centered on the intricate dynamics between the budgetary allocations and the socio-economic segments, offering valuable perspectives on the broader implications for the lower and middle-class sectors.

Mr. Saugata Bhattacharya, Former Chief Economist at Axis Bank, played a pivotal role in advancing the dialogue by delving into the intricacies surrounding the fiscal deficit. With an insightful perspective, he emphasized the government’s commitment to promptly reduce the fiscal deficit and explored the associated macroeconomic financial implications. Mr. Bhattacharya outlined key considerations, highlighting the need to compress expenditure for revenue augmentation, the impact on the government’s borrowing capacity, and the crucial aspect of maintaining controlled inflation. His takeaways provided a nuanced understanding of the economic complexities addressed in the budget, emphasizing the importance of fiscal discipline and its broader ramifications.

In his noteworthy contributions to the discussion, Mr. T K Arun, an Independent Journalist, skillfully illuminated the glaring income disparities existing between the lower and upper echelons of society. He provided a succinct analysis of their consumption patterns and the ensuing repercussions on market dynamics, underlining the pivotal role of government policies and schemes such as MGNREGA.

Mr. Arun not only addressed the crucial aspect of budget allocations but also delved into the broader economic landscape, emphasizing the need for policies to accompany schemes. He astutely evaluated the strengths of the budget, commending its inclusive and multi-targeted approach with provisions for various sections of society, including women, tribal communities, the poor, and farmers. However, he expressed a valid concern about the formulation of schemes without accompanying policies, deeming it a substantial cause for concern. In conclusion, Mr. Arun provided insightful reflections on the potential impacts of fiscal consolidation, particularly in the context of large economies like India.

Dr. Rajesh Shukla, the Managing Director and CEO of People Research on India’s Consumer Economy (PRICE) ICE360 at the Indian Institute of Management Udaipur, provided valuable insights into the dynamics of the Indian consumer market, with a specific focus on the household sector. Grounding his analysis in datasets spanning the pre-COVID, during COVID, and post-COVID scenarios, Dr. Shukla shed light on essential aspects for consideration. He emphasized the heterogeneity among states, noting that growth trajectories differ significantly between states like Punjab, Bihar, and Kerala.

Additionally, he underscored the disparities between developed and developing states, urging a nuanced evaluation. Dr. Shukla also advocated for an examination of the states’ socioeconomic structures from the top to the bottom of the pyramid. In his concluding remarks, he highlighted a concerning trend of reduced real earnings among households, contributing to the escalating inequalities in the developing world.

Prof. NR Bhanumurthy, the Vice-Chancellor of Dr. B.R. Ambedkar School of Economics University in Bengaluru, provided a comprehensive analysis, juxtaposing India’s economic situation with that of other nations, ultimately characterizing the budget as optimistic. Drawing parallels between the global crises of 2008 and the COVID crisis in 2019, Prof. Bhanumurthy conveyed his perspective on the Interim Budget, considering it more bookish than political. He straightforwardly delved into key economic indicators, notably highlighting the Public debt-to-GDP ratio and its pivotal role as an anchor for consolidating the fiscal deficit. Moreover, he acknowledged the budget’s focus on reducing inequalities among ratios, emphasizing its commitment to achieving outcomes that enhance public expenditure efficiency.

Dr. Pooja Misra, Professor of Economics at BIMTECH, highlighted the gaps in the implementation of the national monetization pipeline, underscoring the imperative for effective execution. Her focus extended to skill development, acknowledging the increased opportunities for employable youth in the 2024-25 Interim Budget. While recognizing positive strides, Dr. Misra emphasized the continued need for attention to this crucial sector. Key areas of National Education Policy and Health Education took center stage in her discourse, emphasizing the urgency for a concentrated approach, especially in developing skilled and semi-skilled training institutes.

Dr. Misra delved into the significance of vocational training, digital initiatives, and stressed the need for prioritizing research and development (R&D) and science and technology (S&T) to propel the nation towards sustained economic growth. In essence, her insights underscored the pivotal role of robust educational institutions in fostering inclusive growth and development, ensuring long-term sustainability for the country’s GDP.

In conclusion, the budget discussion encapsulated a spectrum of perspectives, ranging from positive outlooks to constructive critiques. The subsequent Q&A session delved into key issues such as the social sector, fiscal prudence, and economic multipliers. Professor Nilanjan Banik, in his concluding remarks, expressed appreciation to the IMPRI team for their adept hosting of the panel discussion, ensuring its seamless execution.

IMPRI’s 4th Annual Series of Thematic Deliberations and Analysis of Interim Union Budget 2024-25

Gender, Social Inclusion and Interim Union Budget 2024-25
General Election and Interim Union Budget 2024-25

Priyanka Negi is research program and editorial associate at IMPRI.