Budget 2019 is a delicate balancing act with focus on social outcomes

Social sector
 
As India moves towards becoming a $5 trillion economy, continued focus on social outcomes will be critical to achieving not only its economic goals but also the Sustainable Development Goals 2030. The Union Budget reaffirms this commitment with consistent allocations across education, skill development, public health, women’s empowerment, livelihoods and WASH, which reflects the emphasis on sustainable long-term development in the government’s 10-point vision. In a difficult year with limited financial resources, the finance minister has balanced allocations across development, fiscal prudence and competing socio-economic priorities.
 
Water and sanitation
 
As several regions of India reel under a water crisis, all water security programmes have been converged under the jal shakti ministry. Marked by an 82% increase in budgetary allocation, the ministry aims to ensure “Har Ghar Jal” to all rural households by 2024. Given that only 18% of rural households currently have access to piped drinking water, the targeting of stressed districts in the short term is a positive immediate response to the water crisis.
 
On the sanitation front, with Swachh Bharat Mission Gramin (SBM-G) having achieved 95% of its target, the shift in focus on solid liquid waste management (SLWM) is a smart move. However, managing SLWM in rural areas may be a challenge in the short term due to inadequate infrastructure and institutional mechanisms. There is a need to focus on sustained open defecation free (ODF) results through consistent behavioural change,and the allocation of Rs 190 crore towards Information, Education, and Communication in SBM-G will ensure long-term benefits.
 
Public health
 
In alignment with the 10-point vision of the government, Ayushman Bharat has received a 122% increase, with a threefold increase in the Pradhan Mantri Jan Aarogya Yojana (PMJAY) insurance component. This will help improve the penetration of the scheme among healthcare facilities, which currently stands at 35% in public hospitals and 10% in private hospitals. The primary healthcare component of Health and Wellness Centres (HWCs) has received a limited Rs 400 crore allocation with a daunting task of achieving the pending 80% of the ambitious 40,000 HWCs target.
 
Key issues such as shortfall and skewed distribution of workforce across districts remain a challenge, and the 37% reduction in budgetary allocation for the upgrade of district hospitals in the current Budget does not help this cause.
 
Nutrition
 
India is home to 31% of the world’s stunted children (between 0-59 months). With the objective of reducing stunting to 25% by 2022, the allocation under the Integrated Child Development Scheme (ICDS) has been increased by 18%. The major part of this increased allocation will go into digitisation and ICT-enabled effective monitoring of Anganwadi Centres to achieve the desired outcomes.
 
Further, the maternity benefit scheme, Pradhan Mantri Matru Vandana Yojana, has received a 100% increase in allocation to address nutrition before birth and low birth weight.
 
The flagship Poshan Abhiyan, which converges all nutrition programmes, has been allocated Rs 3,400 crore to ensure outreach to 136 unserved districts (target: 719 districts). The distribution of allocation indicates the government’s multi-pronged approach towards holistically addressing malnutrition and achieving the target of malnutrition-free India by 2022.
 
Education
 
Education is critical to encashing the demographic dividend and achieving the vision of a $5 trillion economy. The 13% increase in allocation and overall budget of Rs 94,854 crore, to be distributed 60:40 between school and higher education, reflects this resolve.
 
To reform the sector and improve governance, the National Education Policy and institutional mechanisms such as the National Education Commission and Higher Education Commission have been proposed. Further, the commitment to transform higher education through world-class institutes, ‘Study in India’ and the setting up the National Research Foundation are welcome moves. However, these initiatives currently have inadequate financial allocation, which are expected to beaugmented once the institutions and programmes are conceptualised.
 
Skill development
 
The budget is aligned with the aim of making India a global hub for a skilled workforce through focus on future skills, language and trans-border skills. This vision calls for better coordination with higher and professional education bodies to impart industry-specific skills.
 
The overall allocation to the skill ministry has marginally increased over 2018-19. A key reason could be the 17% underutilisation of the budget in the past year.
 
The Pradhan Mantri Kaushal Vikas Yojana, the flagship skilling programme, targets to train 10 million youth by 2020; however, with 50% of the target pending, a 3% reduction in allocation will pose a challenge.  Changes in the programme design will be required to achieve the training and placement targets. With respect to increasing placements, the allocation of Rs 61.25 crore in the Budget for promotion of apprenticeships is a welcome measure.
 
Women’s empowerment
 
Over the years, the government has laid immense focus on empowering women to become partners in development. The budget witnessed a 17% increase from 2018-19 (as compared to a 21% increase between 2016-17 and 2017-18). The lion’s share of 95% allocation to the ministry of women and child development is towards ICDS, with only Rs 1,315 crore for women’s protection and empowerment. The allocation to key safety initiatives - Women’s Helpline and One Stop Centre - has fallen by 39% and 10% respectively.
 
Financial empowerment and self-employment for rural women have gained focus through expansion plans of the SHG interest subvention programme from 150 to all districts. However, with the National Rural Mission targeting a 92% increase to one crore SHGs in 2019-2020, the 56% increase in budgetary allocation may not suffice.
 
Livelihoods
 
An underlying theme of rural employment is visible in the policy intent and the allocation across various ministries and departments. The indicative gradual policy shift towards sustainable employment generation in both the budget and the latest Economic Survey has lent renewed focus to rural livelihood development catering to 66% of the population.
 
The Rs 125 crore allocation (a 45% increase) to the Scheme for Fund for Regeneration of Traditional Industries (SFURTI) to revitalise traditional industries and generate local employment is a welcome measure. However, since its inception in 2014, only 72 rural clusters have been approved; therefore, developing 100 new clusters will be a daunting task.The additional focus on promoting 80 rural incubators and renewed marketing efforts for handloom/handicrafts through GI will further propel the rural industries.
 
The allocation of Rs 60,000 crore to the flagship Mahatma Gandhi National Rural Employment Generation Scheme (MGNREGS) is a marginal reduction from the previous year’s revised estimate of Rs 61,084 crore.
 
Textiles
 
The textiles and apparel sector continues to be one of the largest livelihood and employment providers, with 4.5 crore people employed directly and another six crore people indirectly. The budget envisages making the industry globally competitive with a 139% increase in budget allocation to the Integrated Skill Development Scheme and technological upgrade through a 12% increase in allocation to the Amended Technology Upgradation Funds Scheme.
 
Further, the 118% increase in the budget for the procurement of cotton under the Price Support Scheme is expected to have a positive impact on cotton farmers.
 
To conclude, while the finance minister’s maiden budget has reiterated the government’s commitment towards sustainable socio-economic development, significant efforts will be required for the world’s second most populated country to move up from its current 112th rank on SDG achievement.