What is the problem with the government’s budget, understand the whole thing here

The first budget of the third term of the NDA government will be presented on 23 July. Although this will be the 11th consecutive budget of the central government led by Prime Minister Narendra Modi, but this time the government faces a different kind of challenge. Firstly, this time for the first time in these 11 years, BJP is not in power on its own. Secondly, this time there is a different kind of pressure on the government from the allies. Thirdly, assembly elections are to be held soon in Maharashtra, Haryana, Jharkhand and Jammu and Kashmir and there is also pressure to present a populist budget. The biggest challenge is that on which section should the government focus amidst limited options. Before the budget, from rural to urban sections have given their wish-list. In such a situation, the budget to be presented on 23 July will not only be the financial account of the government, but it will also provide a blueprint for the future political direction.

Every section’s gaze is fixed
This time the middle class has the most eyes on the budget. They want to see a box of relief for themselves in the budget. Especially on the tax front, the pressure on the government to give concessions has increased a lot. Even though BJP’s seats decreased in the 2024 general elections, the figures that came after the elections proved that the middle class remained strongly associated with the BJP. Now if we look at the debates and discussions of the middle class people on social media after the elections, they argue that in comparison to the support they have taken in the last few years, BJP has not given as much relief as was expected. The government is also aware of this. The discussion of the ever-increasing tax collection also went down well with the middle class. This is the reason why the Modi government has now started avoiding making the GST collection figures public regularly. Also, the Sangh has also given feedback to the BJP that it should give relief to the middle class on the tax front, otherwise now its patience may break. Actually, the middle class section plays an important role in creating the narrative, as well as in spoiling it. The government is aware of this.

But this is not the only cause of concern. This time in the general elections, BJP suffered a setback in rural areas. It was said that there was silent resentment among the people due to inflation, problems of farmers etc. The challenge is also of employment for the youth. Recently, the opposition successfully made employment a big issue. Although the government has been denying its failure on the employment front on the basis of different figures, but it knows very well that it will have to take big steps immediately in the field of employment. The figures released after the elections indicate that the dominance of BJP among the youth of 18 to 25 years has decreased. This is the largest section in terms of numbers and influence and the support of this section has contributed a lot to the continuous strength of the BJP led by Narendra Modi since 2014. In such a situation, the central government has the challenge of giving a message to all of them in the budget this time that it stands with their interests and expectations. Even though this is the first budget of the third term of the NDA government, but in such a critical time, BJP will not weaken its political hold anywhere, which will increase its problems.

Will there be reforms or will they stop?
If the central government presents a populist budget to satisfy all sections of the budget, then the big question that will come up before it is what will happen to the reforms? According to experts, the country’s economy is still in the recovery stage, so it will not be easy to face the challenges of a big populist budget. Anyway, Narendra Modi has been against the concept of a populist budget from the beginning. he/she had also questioned the culture of Revdi in the past. But the way populist economic aid schemes were announced in Madhya Pradesh just before the assembly elections, and now in Maharashtra, it indicated that BJP can now compromise in the face of political compulsion. But this can have serious side effects. If the government takes such a risk in the first year itself, then what will be its impact in the next four years, this also has to be assessed.

There is already uncertainty on many fronts, including the global situation. The government cannot ignore these challenges. Apart from this, the industry also has its own wish-list. In recent years, the middle class’s investment in the stock market has increased manifold. They also got good returns there. In such a situation, the government would not like to take any risk that an adverse message goes out there and the market gets a red signal. A senior person associated with the government admitted in a conversation that this time the toughest challenge is in front of us in the last 11 years. The political situation was already challenging. In such a situation, the budget can decide not only the economic direction but also the political direction. But amidst all this, a senior person from the government also said that when such a big challenge comes from all sides, then sometimes the option of being defensive and maintaining the status quo silently without taking any risk is the best.