Tuesday, July 7, 2009

The Budget : A Jholawallah's perspective

For years, it has been accepted that budgetary allocations would be largely for defense, internal security and industry. Allocations for the social sector have been declining for years , ever the structural adjustment programnes began in the nineties , with the government handing over more and more segments of the development sector to the private sector under the nominal guise of the public-private sector partnerships. This year’s budget therefore, at least in its pronouncement is a welcome break, though the old demons of the PP partnerships still remain in the infrastructure sector – and it is on the backbone of infrastructure that most social development – be it health or education or economic empowerment occurs.

Some of the salient areas where the social sector has been assisted include :

• The total allocation for the Rashtriya Mahila Kosh, which works towards credit support to poor women for innovative schemes, will be increased from Rs.100 crore to Rs.500 crore.

• Another highlight of the budget was that all services under the Integrated Child Development Services (ICDS) will be made available to all children under the age of six by March 2012.

• The National Mission for Female Literacy will aim at reducing female illiteracy by half in three years.

The government’s increased expenditure on infrastructure, agriculture and urban development should boost growth and receipts, and new incentives for private investment in education, social security and energy security should provide an impetus to these sectors while strengthening India’s competitiveness. To ensure balanced and equitable development, the government has widely increased the allocations to social development schemes, which should also play a vital role in boosting rural development and demand.

Baits are being provided for NGOs and charities to be involved in environmental concerns, tax benefits being one. At the moment , a charitable purpose under the present provisions of section 2 (15) of the Income Tax Act, ‘charitable purpose’ includes relief of the poor, education, medical relief, and the ‘advancement of any other object of general public utility’… The budget proposes to provide the same tax treatment to trusts engaged in preserving and improving our environment (including watersheds, forests and wildlife) and preserving our monuments or places or objects of artistic or historic interest bringing these activities under the ambit of charity.

Of course, not every will be satisfied. As someone who is working with issues of children at risk, I cannot but remember that India has the world's largest population of children, accounting for around 375 million of the country's billion-strong people. But budgetary allocation for them has for years been pitiable at a meager 1.2 per cent of the Budget and this year does not appear to be too different.

However, the focus of this Budget and of the government is to use a combination of pragmatic, humane and bold policy making to create the economic foundation upon which we can build a progressive and prosperous nation in consonance with the concerns and aspirations of all sections of society and that certainly ought to be commended, but a certain sincerity of approach that is visible here, that one failed to see for instance in the Railway Budget, presented just days before.

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