Budget 2025: Patting on Middle Class Dreams in Gross Disregard of the “Absolute Poor”!
As expected, the 2025 Budget speech of Indian Finance Minister reveals Modi regime’s resolve to accelerate far-right neoliberal policies along with pampering or patting on the dreams of India’s growing middle class in gross disregard of the country’s most downtrodden working and oppressed people, which according to global studies, comprises more than 50% of world’s 70 crore “absolute poor”. Comprising around 35 crore, in a population of 145 crore, these most deprived and oppressed people engaging in menial, unskilled manual work are being registered under MGNREGA, the much trumpeted Employment Guarantee Scheme, that had earlier promised minimum 100 days employment per year for them across States.
As estimated by experts last year, at least a minimum of ₹ 2.70 lakh crore – around 1.5% of India’s GDP in 2024 – should have been allocated in the budget for MGNREGA to provide 100 days employment to the “absolute” or extreme poor in India. However, under Modi regime, that is engaged in achieving “Viksit Bharat” by 2047, the budgetary allocation to Employment Guarantee Scheme has been steadily going down over the years. As per budget estimates, in 2021, it’s allocation was 0.56% of GDP, which declined to 0.41% in 2022, 0.33% in 2023 and 0.25% in 2024. Revealingly, in its over-enthusiasm to placate the middle classes, characterizing the budget as a “testament to country’s middle class”, and to ensure their vote-bank, and making “Viksit Bharat” as consumption-driven, while Modi govt has foregone around ₹1 lakh crore in 2025 budget by way of income tax reductions and various exemptions, it has not even made a mention on MGNREGA this time, thereby totally condemning the “absolute poor” to a life of horrific poverty, agony and misery. While World Bank defines “absolute poor” as those having less than $1.90 per day, for India the criterion is $1.15 a day!
Meanwhile, India is having world’s lowest corporate tax regime and Indian billionaires wealth has been surging 42% in the last financial year. However, the entire burden of taxation has been on India’s common people through world’s most regressive GST. It is in this context that 2025 budget has envisaged to liberalise the tax regime further, coupled with a series of “ease of doing” and “investor-friendly” measures including pro-corporate prodding in the form of further liberalisation, deregulation and globalisation in policy-making and execution. All infrastructure projects and development programs mentioned in the budget, and for research and devlopment, urban development and even for nuclear energy projects, crony-capitalist involvement is ensured through so called PPP scheme. The ₹20000 R&D Initiative for Small Modular Reactors envisaged with private participation and the proposed amendments to Atomic Energy Act, and Civil Liability for Nuclear Damage Act will expose India not only to nuclear catastrophe but also transform it as a dumping ground for costly and unsafe nuclear plants and nuclear waste from imperialist powers. And to facilitate all these corporate offensives, the 2025 Budget, for the first time, has proposed an Investment Friendliness Index for accelerating neoliberal corporatisation in States with the involvement of MNCs and their Indian junior partners.
An ingenious move in this direction, probably to appease far-right neofascist Trump, is the unprecedented opening up of Indian Insurance sector for 100% FDI. It will pave the way for the free entry, loot, and exit by the notorious and blacklisted US insurance companies. The abrupt elimination of seven tariff rates in the foreign trade sector along with the plan to simplify and streamline the custom tariff structure altogether in the budget is another impact of the Trumpian threat. Obviously, the budget also has rhetoric on such frontier technologies as AI for which India has no other option other than to abjectly depend on tech tycoons from either US or China. In this regard, a proposal for an investment of ₹500 crore for a Centre for Artificial Intelligence is also there. In brief, following the various pro-corporate announcements in the Budget, the stock market indices, both Sensex and Nifty, shedding their initial volatility, also began surging as the Finance Minister concluded her speech.
However, the concrete Indian realities are far-away removed from the illusions spread by Modi regime and pliable corporate media. The IMF, the neocolonial arm of US with latter’s veto power in it, has already made its forecast that Indian GDP growth rate will not exceed 6.5%. As concerned people know, the parameters of India’s budget including its fiscal deficit target in the neoliberal period is ultimately decided by the FRBM Act (Fiscal Responsibility and Budget Management Act) passed by Vajpayee government in 2003 as per IMF diktats. As such, in spite of its motto of an 8% GDP growth for accomplishing Viksit Bharat in 2047, and such other claims as fastest growing economy, etc., the Economic Survey, in line with the projections of IMF, had to confine the GDP growth rate to 6.4% in the year ahead.
At the same time, as already noted, with more than half of world’s absolute poor, India is often called a “citadel of global poverty”, and inequality under Modi rule has become horrific with 1 percent of superrich holding more than 40 percent of country’s wealth. More than 90% of those who are employed are in the informal/unorganised sectors with no job guarantee, social security and having no provision for minimum wages. Still, with world’s largest share of jobless people, India is like a wasteland of unemployment. The more than ₹10 lakh core Capex – Capital Expenditure – mentioned in 2025 budget (in the last budget, it was ₹11.11 lakh crore) under PPP and other routes will be primarily diverted to money-spinning and quick profit-yielding speculative spheres by crony capitalists rather than for developing employment-oriented productive spheres. The budget also makes a mockery of Indian federalism by extending apparent bonanza for Bihar like States under ‘fascist double engine’. To be precise, therefore, the budget and its provisions that work within the logic of neoliberal corporatisation cannot break the vicious circle in which the country and its people are placed. And the so called “Amrit Kaal” that is repeatedly echoed by the ruling regime cannot whitewash the harsh realities confronted by the common people of India. It is upto the working class and oppressed people together with all progressive-democratic forces to expose the true essence of the budget, with the people’s perspective for a political alternative.
P J James
General Secretary
CPI (ML) Red Star
New Delhi
01.02.2025
