Economic Survey Highlights Contradictions in Budget Projections
The Economic Survey 2024-25 focuses on achieving “Viksit Bharat – 2047,” a vision that requires sustained annual growth of 8%. However, the Union Budget projects growth at just over 6%, falling short of this target. Analysts have voiced concerns over this gap, highlighting the challenges in meeting long-term economic goals.
Shiva Kumar, a former Railway Mazdoor Union leader and analyst, criticized the government for failing to control high inflation. He argued that inflation undermines the benefits of tax relief and other budgetary relaxations, as indirect taxes continue to burden the public.
According to Kumar, the Economic Survey emphasizes the need to increase per capita income to achieve growth. To reach the Viksit Bharat goal by 2047, India’s per capita income needs to rise to $13,000. However, the country is currently at just $2,500. Kumar stressed that an 8% GDP growth rate is essential for this, as stated by the CEO of NITI Aayog. Without controlling inflation, real income growth will remain stagnant, leaving the underprivileged classes with little benefit.
Kumar also highlighted the alarming rise in household debt, which now stands at 39% of GDP. He noted that any savings from tax exemptions for the middle class are likely to be used for repaying loans. He further claimed that the decision to relax income tax for those earning up to ₹12 lakh annually was influenced by pressure from business groups like FICCI and CII. These groups, Kumar explained, want to push sales by clearing piled-up stock, as the middle class has reduced spending due to financial strain.
Drawing attention to the informal sector, Kumar pointed out that 95% of workers lack paid wages and health benefits. Many of these workers face job insecurity, as they can be hired or fired at will. He also mentioned that some railway contract employees have not received their pay for two months, highlighting the struggles faced by workers in this sector.
In conclusion, Kumar argued that the government’s budget fails to align with the goals outlined in the Economic Survey. Without addressing inflation, household debt, and the lack of support for the underprivileged and informal sector workers, the vision of “Viksit Bharat – 2047” will remain a distant dream.
