What she chose instead was a political document that is well in sync with the ruling BJP’s belief that elections are an ongoing game. The finance minister adroitly divided the larger part of her budget into segments, or political constituents — such as rural, urban, women and farmers. The overarching aspirational narrative was of India closing in on the target of becoming a $5 trillion economy. What she added was ease of living, a slogan that transcends the usual divides — class and caste, urban and rural. And she showed her political maturity by taxing the super-rich with an annual income of Rs 2 crore and above, and by not extending the reduced 25% corporate tax bonanza to India’s top 0.7% companies.
“Hey, it’s not a suit boot ki sarkar,” was her subtle message.
So where does this budget, presented by a first-time finance minister, stand when compared with the maiden budgets of other finance ministers? ET Magazine analyses the first budgets of seven FMs, including Independent India’s first one, which was presented by RK Shanmukham Chetty on November 26, 1947.
The first big difference in the budgets of Sitharaman and most of her predecessors is that she has avoided any mention of the economic hiccups. Contrast this with others. Chetty, for example, began his speech by narrating the post-Partition holocaust — people getting “brutally butchered” and millions of innocent men, women and children being “driven out of their ancestral homes and forced to make a dusty, deadly trek in search of a new home”. Morarji Desai, who presented 10 budgets — the highest by any finance minister — began his first budget speech in February 1959 by referring to a record low in agricultural production and a slowdown in industrial output.
That his own party, the Congress, was in power did not stop him from naming the challenges. In fact, recording adverse economic climate in the budget was considered normal by most FMs in the past.
Sitharaman chose to highlight all the positives of her party’s previous regime (2014-19) — a performing government, rejuvenated Centre-state dynamics and a strident commitment to fiscal prudence — adding how the hearts of millions of Indians were filled with hope, trust and aspirations.
Another notable change was that most first budgets of previous FMs created new institutions. Modi government’s finance ministers have not done this. Sample this: Pranab Mukherjee announced the creation of the National Bank for Agriculture and Rural Development in his first budget, presented on February 27, 1982; P Chidambaram in his first budget ( July 22, 1996) created the National Highways Authority of India and Manmohan Singh in his trend-setting 1991 budget chose to chart out a new liberalised economic path, memorably quoting Victor Hugo: “No power on earth can stop an idea whose time has come”.
To her credit, Sitharaman has introduced some positive changes, says Vijay Paul Sharma, the IIM-Ahmedabad professor deputed as chairman of the Commission for Agriculture Costs and Prices. “Formation of 10,000 new farmer producer organisations and promotion of entrepreneurship in farm and rural sectors will facilitate better market linkages, especially for small and marginal producers.”
Former Railway Board chairman Arunendra Kumar says: “FM’s intent to bring in private investments into the Railways is clear when she talks about Rs 50 lakh crore investments in 12 years. She has emphasised a lot on public-private partnership.”
Unlike some of those clear takeaways, Sitharaman’s document may have some partly hidden messages that will surface as Modi’s second innings progresses. Who would have thought Arun Jaitley’s first budget in 2014 had an underlying tone of nationalism, even as he set aside Rs 200 crore for a statue of Vallabhbhai Patel, Rs 100 crore for a war memorial and Rs 50 crore for a National Police Museum? But by 2019, all those initiatives accrued as political capital for the ruling party. No wonder, when the government undertook an air strike in Pakistan’s Balakot in February, the BJP could easily strike a nationalistic chord with voters. After all, it had built up the narrative over five long years.
Sitharaman’s emphasis on national duties, as against rights, has somewhat similar connotations. “Marking 75 years of our Independence, we should place emphasis on our duty towards India…we should dedicate ourselves to serve our nation,” she said in her budget speech.
This tone has a familiar ring. The civil servant-turned-FM, CD Deshmukh, had in his first budget (1951-52) narrated an incident of how a poor villager with “a burning desire to help the Government of India” remitted a sum of `5 with an assurance that he would continue to pay the same amount every year. No wonder, beneath hard fiscal numbers, finance ministers always make attempts to deliver subtle messages. On that count, Sitharaman has hit a six.
Budget: Then and Now
RK Shanmukham Chetty (1947-1949)
BUDGETS PRESENTED: 2
Handpicked by Mahatma Gandhi against the wishes of the then PM Jawaharlal Nehru, the former Diwan of Cochin presented Independent India’s first budget.
Ist Budget, 1947-48
PRESENTED ON: November 26, 1947
TOTAL RECEIPTS: Rs 171 crore
PROGRESS: Rs 197 crore
RESULT: Rs 26 crore
*Setting up of Partition council and rehabilitation of refugees
* Setting up of Damodar Valley Authority
*Construction of Hirakud Dam (Odisha) and Bhakra Dam (then Punjab)
CD Deshmukh (1951-57)
BUDGETS PRESENTED: 7
A civil servant-turned-FM, Deshmukh was also the first Indian to be appointed as governor of Reserve Bank of India.
Ist Budget, 1951-52
PRESENTED ON: February 28, 1951
TOTAL RECEIPTS: Rs 370 crore
TOTAL EXPENDITURE: Rs 375 crore
DEFICIT: Rs 5 crore
* Setting up of Central Jute Board, Cotton Advisory Board
*Reorienting the Grow More Food Plan
*Introduction of sales tax in Delhi
Morarji Desai (1958-63; 1967-69)
BUDGETS PRESENTED: 10
Desai, who later became India’s fourth prime minister, has the rare distinction of presenting the most budgets
Ist Budget, 1959-60
PRESENTED ON: February 28, 1959
TOTAL RECEIPTS: Rs 757 crore
TOTAL EXPENDITURE: Rs 839 crore
DEFICIT: Rs 82 crore
*Formation of Heavy Engineering Corporation
*Intensification of the savings movement
*Simplification of company taxation
Pranab Mukherjee (1982-84; 2009-12)
BUDGETS PRESENTED: 8
Mukherjee, an all-weather politician, always believed that the budget is more of a political instrument.
Ist Budget, 1982-83
PRESENTED ON: February 27, 1982
TOTAL RECEIPTS: Rs 27,134 crore
TOTAL EXPENDITURE: Rs 29,219 crore
DEFICIT: Rs 2,085 crore
*Establishment of National Bank for Agriculture and Rural Development
*Emphasis on small savings with the introduction of social security certificate
*Road map for implementing the revised 20-point programme
BUDGETS PRESENTED: 6
Singh, who later became India’s 14th prime minister, used his first budget to engineer a historic shift in the economy.
Ist Budget, 1991-92
PRESENTED ON: July 24, 1991
TOTAL RECEIPTS: Rs 1,03,698 crore
TOTAL EXPENDITURE: Rs 1,13,422 crore
DEFICIT: Rs 9,724 crore
*Structural reforms in industrial policy
*Trade reforms and liberalisation in foreign direct investments
*Investment incentives for non-resident Indians
P Chidambaram(1996-98; 2004-2008; 2012-14)
BUDGETS PRESENTED: 9
Known for balancing sops and fiscal prudence, Chidambaram has presented the most budgets, after Moraji Desai.
Ist Budget, 1996-97
PRESENTED ON: July 22, 1996
TOTAL RECEIPTS: Rs 1,95,774 crore
TOTAL EXPENDITURE: Rs 2,04,698 crore
DEFICIT: Rs 8,924 crore
*Setting up of Infrastructure Development Finance Company
*Setting up of National Highways Authority of India
*Setting up of Foreign Investment Promotion Council
Arun Jaitley (2014-2019)
BUDGETS PRESENTED: 5
Jaitley’s first budget sowed the seeds of a narrative around nationalism as he made provisions for building a war memorial, a police memorial and a massive statue of Sardar Patel.
Ist Budget, 2014-15
PRESENTED ON: July 10, 2014
TOTAL RECEIPTS: Rs 12,63,715 crore
TOTAL EXPENDITURE: Rs 17,94,892 crore
DEFICIT: Rs 5,31,177 crore
* Major emphasis on rolling out of Goods and Services Tax
* Further liberalisation of FDI and raising of its cap in defence manufacturing to 49%
* Releasing initial fund for building 100 smart cities
Other FMs who have presented budgets include John Mathai, TT Krishnamachari, Jawaharlal Nehru, Sachindra Chaudhuri, Indira Gandhi, YB Chavan, Hirubhai M Patel, R Venkataraman, VP Singh, Madhu Dandavate, Yaswant Sinha, Jaswant Singh and Piyush Goyal.
Source: Budget documents