Review of Budget 2025 in Advance

A largely facetious, partly serious take on the impending Budget 2025 - stated for tomorrow.

For a start, one can print the reactions of the various voices to any budget in bulk and simply rehash it every year. They are so predictable that the only person who can say something different is Shashi Tharoor because he will use new words that make you think he is saying something different. The other would be Suhel Seth. He takes on various people right from correcting their grammar and spellings to his hilarious responses in his trademark style. Unlike Shashi, Suhel uses Shakespearian English to insult the political folks, and they don’t even realise they are being insulted.

That said here are a few typical comments that will come from the opposition, and these are a collection since the 80’s when I first heard what a budget was. Obviously in 40+ years nothing has changed, and I share my own comments in italics and red against some of the comments.

1. If any budget is not for development and any development is not for the people, then it is useless. – Wow what a philosophical thought.
2. Anti-people budget. – One always thought Govts came up with budgets that would help them win elections.
3. This is a farewell budget.
4. Finance Minister poured "cold water" on people's expectations.
5. Budget only aims to woo people ahead of polls. - Isn’t that what all governments do?
6. Is this a budget to provide employment to the unemployed? – Totally flummoxed on this being sarcasm or a deep question?
7. Delivery was zero. – Seriously? What did this chap expect to be delivered?
8. Nothing much has happened. – I mean what exactly did this chap expect to happen?
9. People of the country are already disappointed. – 40+ years and counting, speaks volumes about our political class.
10. People are rejected with this budget. – Another profound comment.
11. Mere administrative exercise. – Stating the obvious!!!
12. Budget full of self-congratulatory, self-praise phrases.
13. Nothing else is there and nothing should have been there, and rightly so, nothing is there. – Hilarious philosophy.
14. Lacked boldness and foresight.
15. Budget did not offer concrete solutions to the challenges facing the economy.
16. Budget has failed to address the critical issue of unemployment. – 40+ years and counting with unemployment still not solved.
17. Did not see any strategic idea that would help our youth get jobs.
18. Fall in core sector growth is serious. – What is this core sector? Everybody defines it as it suits them.
19. Budget fails to layout roadmap on how to address challenges. – Dude, life itself is a challenge, and budgets are not behavioral science sessions.
20. Budget is insipid, lacks stimulus for growth; no clear roadmap for future.
21. Boring. – The one chap who is probably honest since they need to sit and listen to a monologue for few hours.
22. Nothing in the budget proposals to alleviate peoples' misery. – Pretty pessimistic chap.
23. Growing unemployment, rural wage crash, farmers' distress, and galloping prices.
24. Inflationary. – Inflation in India has been above 0 since 1977. While it has peaked at close to 14% it has been hovering around 4 to 7% for most times.
25. Anti farmer. – The most classic statement for all times to come since 50 years.
26. Lacks imagination. – God help the nation if imaginations run wild in making budgets (read ideas below)!!!
27. Nehruvian socialism. – If Nehru is not invoked, no budget/ reaction is ever complete.
28. Sell out to big business. – Another all-time classic. From Tata, Birla, Bajaj to Ambani, Adani.
29. Most precarious and difficult economic situation in many years. – Height of Pessimism.

Anyway, coming to the 2025 budget that is YET to be announced and expected to be on 1^st Feb, here are some thoughts.

For long the nation waited for the Railway budget which was created as if the nations finance depended on that organisation. In 75 years, India did not deem it fit to think of a separate Agriculture or Defence budget though every budget in 50 years has been termed Anti farmer. My sense is that some grown up men/women needed toys to feel excited (pun intended) and important and what better way than to give a huge train network as a “toy” to these folks? One great gentleman had a broad-gauge line constructed within his constituency (Hint: Malda) when the entire network in the area was meter gauge. “Toy” trains did I say? Luckily this profound stupidity was stopped some time back.

Next the budget was always by late evening and the implementation after midnight. Most folks knew that petrol/diesel prices would go up and so by evening every fuel bunk had mile long lines waiting to fill up petrol/diesel before midnight. Some companies rushed to despatch goods at lower tax rates before midnight. Those were the days when budgets meant – running to save money. Post 1991, budgets meant – running to spend money. Luckily this also changed sometime back. Now budgets mean - running to the remote to change channels, only to find the same thing everywhere.

Listening to the budget speech was the most important activity for the business leaders, heads of households since they had to take and implement decisions before they could read the fine print, understand the budget and wait for the official notifications. Today as the editorial of Economic Times said – nobody cares much anymore; it has ceased to thrill, when it was licensed to thrill, bill and kill.

Expecting abolition of Income tax is where the imagination really starts and so lack of imagination is an appreciation rather than criticism by the opposition. For those who critique budgets and governments as lacking in imagination, boldness, insipid, boring, all I can say, if that is what you want, lets announce changing the face of that boring, toothless smiling old man on our currency to something like these. Trust me, everybody will listen to the budget speech, everybody will have comments that are entirely new and finally those who keep advocating the use of cash as against cashless/UPI, people will start insisting on cash. 

At best some tweaking of income tax slabs can be expected. Where this Narendra Modi govt has erred is, they have taken out the marketing/branding/advertising benefits of a budget and made it into a dull, drab, boring documentary made by a Govt department on a shoestring budget. A salaried middle-class chap who, the various ministers will extoll has been rewarded, will finally hear about it exactly 13 months later when his tax returns are filed, and they are told they did save money. By then these chappies would have stopped listening.

For long, the budgets of the current government have been supply side economics. The belief is that you build a better road, support industry in building a better mousetrap and the rats will come running. Some rats maybe, most, especially post Covid are focused on saving money for the next pandemic, believe that stock markets give best results. 2024 saw 268 IPO’s collecting a record 1.67 Lakh Crores (around 19 billion USD). While this boom is expected to continue, the conundrum lies elsewhere.

Most IPOs reflect the value perception of a company. They collect the cash from the people, but often as with start up’s, the early investors are cashing in while others are retiring debt etc. How much of this goes towards actual investments into building capacity, creating jobs and paying wages that leaves more money to spend on the table is a big question. Data indicates that only around 20~25% goes towards capital expenditure and acquisitions.

Every politician will talk of Farmers and put them on a pedestal higher than God - but only in talk. The key requirements for Agriculture to become a engine of growth, create significant prosperity at the bottom of the pyramid, is to create laws, like an industry has, so that the labour get gainful employment with social security, farmers get global market access and market product demand information, make farm land holdings economically viable, increase productivity, bring in crop rotation, control the business of "farmhouses" as a "tax saving", "bragging rights" investment for the upwardly mobile urban class, ear mark large areas in a contiguous manner for only farming/ forests etc to ensure food security and make agriculture a growth engine, not a political parasite engine. 

Every government talks of Healthcare and Education which should be the foundation of any nation. Yet both these sectors are commanded by private players, often the political class or closely aligned to them. Let alone the poor, even the upper crust of the ordinary middle class can get bankrupted by either of these, and, they spend the prime of their lifetime saving/spending on children's education, elderly parents. For long, insurance (healthcare) wasn’t very popular and while there has been an uptick here – truth be told, it’s more a feel-good factor. Sticking my neck out I would even call it a “scam” where the insurance companies, hospitals and the Government actively work in ripping every patient for all they are worth. Insurance companies often refuse cashless settlement whenever they can, question claims and bring them down by 40%, hospitals charge you based on the limits of one’s insurance policy and finally the Government fleeces the people with GST. A senior citizen pays 18% GST for a paltry insured sum of Rs. 10 Lakhs. A major ailment like a heart attack, this amount disappears in hours. High decibel criticism on this is very much justified, except that even the opposition ruled state Govts refuse to get this removed in the GST council.

School fees even at the class 1 to 5 stage is so high, that in our younger days we could have gone to USA, obtained advanced Master’s degrees spending less than this amount. Paradoxically the fees reduce significantly as one progresses to the Master’s degree stage in India.

The oft repeated suggestion to give tangible tax relief for education and healthcare has always fallen on deaf ears – with every government. Don’t expect any better in the 2025 budget. As for the rest, don’t expect anything that would make you whistle and run to the nearest ATM. Instead sit on a chair with your Smartphone and start passing expert comments on the Budget on X, Facebook and WhatApp.