Budget of political consolidation
Though the Constitution christens the Budget as annual financial statement, the fact is that it’s also a compendium of the government’s political vision, policies and prerogatives. It’s the statement of will of the government and its execution defines the commitment of the government to meet its goals ideologically and otherwise. In fact it can safely be said that politics is the soul of any government’s annual financial statement.
The Budget presented by Finance Minister Arun Jaitley on 10 July 2014 makes no bones about the fact that the politics of this year’s annual financial statement is firmly focussed on strengthening anti-Congress ideology. Jaitley through his maiden Budget speech asserted that the government has not lost focus of the anti-Congress plank.
While it left the flagship Congress programmes like the MNREGA untouched for now, it made clear through various other indications that the new government believed in disassociating with Congress legacies. While it named the programmes after the anti-Congress icons like Syama Prasad Mookerjee, Deen Dayal Upadhyay, Madan Mohan Malviya and Jaya Prakash Narayan, it also set aside an amount of Rs 200 crore for building the 182-metre tall statue of Sardar Vallabh Bhai Patel at Saradar Sarovar Dam in Gujarat.
Refusing to be miserly on symbolism, Jaitley also announced building of a war memorial in the memory of the Indian soldier at Princess Park, close to the India Gate, the war memorial built by the British post World War I and launching of the ‘Namami Ganga’ scheme for cleaning river Ganga. Congress leaders like Jairam Ramesh have already cribbed that cleaning of the Ganga was being made into a Hinduvta plank.
Between Modi and Jaitley, there seems to be a fair understanding of the failings of the Atal Bihari Vajpayee government. Though the BJP has overtly always flaunted the success story of the Vajpayee government, it always realised that the failings of NDA I to push the Sangh agenda not only vis-à-vis Ram temple but also in matters of economics and state politics was one of the major factors in keeping the party out of power for nearly decade.
Right-wing ideologue Swapan Dasgupta recently wrote, ‘In the six years of NDA rule under Vajpayee the economy performed well and India embraced the logic of rapid growth. At the same time, there was a political disconnect between Government policy and the bhavna of the party’s traditional support base. The core of the BJP is essentially middle class defined not merely in economic terms but also in terms of aspirations. They were also bound by values that ranged from Hindu nationalism to a celebration of the family. The typical BJP supporter embraced the trappings of modernity-particularly technology-but in a nationalistic, indeed anti-Western, idiom.’
Therefore no wonder that Arun Jaitley’s pronouncements on issues like retrospective tax, disinvestment, labour reforms and FDI limits have been calibrated by the thinking of the Sangh on the matter. I see no wrong in it as mobilisation of the Sangh cadres was a major factor in the stupendous pre-poll campaign run by prime minister Narendra Modi.
Having faced vitriolic criticism during the poll campaign from its adversaries especially the likes of the Aam Aadmi Party of the BJP for being pro-corporate and that their coming to power only ensured ‘ache din’ for the business houses, Jaitley was careful to ensure that no benefits accrued directly to the business houses from his Budget speech. Backing Jaitley’s line Modi too felt that the issues like the Vodafone retrospective tax case needed careful handling and any move to reverse Rs 22,000 crore tax liability could invite stringent criticism from rivals. But the speech also had a sense of assurance that retrospective taxation would be the last rescue of the government to raise revenue.
This stratagem of blunting opposition through deft play of words and intelligent strategy by the best known legal face of the BJP drew an immediate contrast with the Congress legal eagles like former union ministers P Chidambaram and Kapil Sibal, who preferred brazening out using court room like argument in public domain, which, as evident, proved very costly for the Congress party. In fact reporting on the strategy of the Finance Minister, a report in a prominent newspaper said, ‘Keen to deny the opposition a provocation to disrupt the Budget speech while also keeping on the right side of the Parivar, red button issues like disinvestment were excluded from finance minister Arun Jaitley’s speech and crammed into lengthy annexures.’
In my understanding the tenor of Jaitley’s address was firmly grounded in the party’s traditional support base rather than aimed at winning accolades in the board rooms of the flamboyant chambers and the multi-nationals. The Budget must have raised the cockles of the heart of the traders, the small-time professionals and the owners of small and medium scale enterprises. No wonder the finance minister took care to frame the disinvestment in public sector firms as something that would give ordinary shareholders an opportunity to pick up stakes in firms that are expected to deliver good and safe returns even as the majority control remained with the government.
Thus the political statement emanating from Narendra Modi government’s first financial document is very clear – the NDA II government would work towards keeping a connect with its social and political base intact, a lesson learnt the hard way from the failing s of the Vajpayee government. The maiden Budget of the Modi government prepared between the prime minister and finance minister could prove to be an important cog in the machine as far as consolidating party’s sway over the support base goes.
The author is with Centre for Reforms, Development & Justice, and is Consulting Editor, Millennium Post