CPI (M) leader Sitaram Yechury and CPI leader D. Raja. File photo
| Photo Credit: SHIV KUMAR PUSHPAKAR

In a bid to reduce the fiscal deficit, the Union government has cut down on expenditure that has led to welfare schemes and capital expenditure being curtailed and this would negatively impact future growth and economic fundamentals, the CPI(M) said critiquing the 2024 Interim Budget.

The Union Budget, the CPI(M) Polit Bureau said in a statement here, reveals the grim economic situation confronting India’s working class. As per the Budget tabled in Parliament on Thursday, the revenue receipts in 2023-24 exceeded the budget estimates and grew by 13.3 per cent compared to the previous year.

Citing these figures, the Polit Bureau said that Central government expenditures have been squeezed below budget estimates in order to reduce the fiscal deficit. These expenditures have grown by only 7 per cent, less than even the nominal growth of GDP, which is officially expected to be 8.9 per cent. This shortfall in expenditure has taken place despite the establishment expenditure of the government being higher than budgeted. “The axe has, therefore, fallen on expenditures on welfare schemes as well as on capital expenditure. This will negatively impact future growth and economic fundamentals,” the party said.

Expenditures on several sectors like agriculture and allied activities, education, health, social welfare, and schemes like the PM Krishi Sinchayee Yojana and umbrella schemes for SCs, STs and other groups have been kept below budgeted levels, the CPI(M) noted.

The revised expenditures on PM Awas Yojana, PM Gram Sadak Yojana, and PM Poshan are not only lower than budgeted, they are even less than the expenditures in 2022-23. “Schemes specifically for women and children have also seen a reduction on both counts,” the Polit Bureau observed.

The CPI(M) said that the estimated ‘real’ growth of 7.3 per cent in 2023-24 is pure fiction and is based on the “absurd proposition that the inflation rate has come down to barely 1.6 per cent in 2023-24”. This figure, the party said, is completely at odds with the inflation rates based on the Consumer Price Index (CPI), which is around 6 per cent with food inflation of around 10 per cent. “This Budget carries forward the vicious ‘development model’ of the Modi government which squeezes the livelihood of the vast majority of India’s working people to favour the maximisation of profits for the few,” the CPI(M) Polit Bureau stated.

CPI General Secretary D. Raja, called the Budget as disappointing. “FM’s Interim Budget speech was disconnected with micro reality and was focused on presenting a rosy picture of the economy before elections. BJP has shown loyalty to corporates continuously by slashing corporate tax. Borrowings are at record high and common people are suffering with high inflation,” he said in a post on X.