Introduction

Every year on 1st February, the country’s budget is announced by the country’s finance minister. In which we get to know how much money does the government earn, how much is spent in different places for the welfare of the people. As usual, this year too, on 1st February, Finance Minister Nirmala Sitharaman presented the Union Budget 2024. But the difference was that this year’s budget was an Interim Budget.

“I commend the Interim Budget to this August House. Jai Hind!” It is a temporary budget that will only give estimates for the entire year. This is because this year the Lok Sabha elections will take place. After the elections, once the new government is formed, the full budget will be presented in July. This is done every time it is an election year, but this does not mean that the interim budget is not crucial. This tells us how the government will spend money during the next few months. And we will also get to know the overall strategy and direction of the government.

So, come, let’s understand in this video, what’s in this new budget for you, the common people, and the promises made in the previous budgets, as well as the expenses, how much of it was achieved, and what were their results.

Capital Expenditure: A Focus Area

Similar to the last year, the main focus area of the government in the budget was Capital Expenditure. In short, it is also called CAPEX. It refers to the money that the government spends on long-term assets. Large infrastructure projects in the economy, like making roads, railways, ports, large-scale buildings or bridges.

Last year, the government had already increased this expenditure a lot, by 33%, and allocated ₹10 trillion. The data shows that although the government had not spent the entire ₹10 trillion last year, the actual spending was still ₹9.5 trillion. But this year, it has been increased further by 11.1% the government plans to spend ₹11.11 trillion this year.

The reason behind this is very simple. The government says that if money is spent on these avenues, then it boosts economic growth and lead to employment creation. People get jobs when such big bridges, roads, and ports are built. The Finance Minister said that in the last 4 years, the capital expenditure has increased by 3 times. For railways, specifically ₹2.55 trillion have been allocated and 3 new corridors have been announced. Energy, Mineral, and Cement Corridor, Port Connectivity Corridor, and High Traffic Density Corridor.

The Finance Minister has also said that more than 40,000 normal rail coaches will be converted to Vande Bharat standards. “Forty thousand normal rail bogies will be converted to the Vande Bharat standards” This year’s railway’s allocation is much higher than last year’s ₹2.41 trillion. While last year, we had already seen an increase of ₹1 trillion. This is good news, but hopefully, its impact will be seen on the ground in railway safety as well. Because last year, there were many accidents. On 29th October, the train collision in Andhra Pradesh. On 11th October, Bihar North East Express derailment. On 26th September, Mathura EMU train derailment. And in June 2023, we witnessed the train collision in Odisha, which was one of the most dangerous accidents in the history of the nation. Almost 300 people lost their lives in this accident. “In India, where at least 260 people have been killed, in a train crash in the eastern state of Odisha. It’s already the country’s worst train crash this century.”

Agriculture Sector and Oil Seeds Initiative

In the agriculture sector, the government has announced Atmanirbhar Oil Seeds Abhiyan and focused on fertilisers like Nano-DAP. Nano-DAP stands for Nano Di-Ammonium Phosphate. A type of eco-friendly fertiliser with 8% nitrogen and 16% phosphorous. This is very useful for Green Farming. That’s why it is being promoted.

On the other hand, in the Oil Seeds Initiative the government has said that they want to cut the imports from outside the country. They want to cut down edible oil imports from 60% to 30%. So that India can become self-reliant in seeds like mustard, groundnut, soybean, sunflower. But the subsidies that are given for fertilizers saw a budget cut. In comparison to the ₹1.89 trillion from last year, only ₹1.64 trillion has been allocated this year. Food subsidies have also been cut. Last year’s budget allocation was ₹2.12 trillion. This year it has been reduced to ₹2.05 trillion.

Education and Healthcare Sectors

In the education and healthcare sectors, we got some bad news. The government had already cut the education budget last year. But the amount that the government had promised to spend last year, they didn’t even spent that, their spending was lower than that.

In last year’s budget, the government promised to spend ₹1.16 trillion on education. But according to the revised budget estimates, the government will be able to spend only ₹1.08 trillion. This year, there is a small increase in the education budget. Instead of ₹1.16 trillion, the government has now allocated ₹1.25 trillion.

On top of that, in the education sector, big budget cuts have been made in many places. For example, the budget allocated to UGC, the University Grants Commission, has been cut by 60%. Last year’s revised estimate was ₹64.09 billion. This year, they were given only ₹25 billion. The budget allocated to IITs and IIMs has also been decreased this year. Instead of ₹103.84 billion, ₹103.24 billion for IITs. Instead of ₹3 billion for IIMs last year, only ₹2.12 billion have been allocated this year. But where has this budget increased in education? More money is being spent on central universities. Instead of the ₹115 billion last year, ₹150 billion have been allocated this year. The amount spent on research and innovation has been increased. Instead of ₹2 billion last year, this year, ₹3.55 billion has been allocated.

In the healthcare sector, last year, the government had allocated ₹890 billion. But, according to revised estimates, only ₹790 billion will be spent. This year, a small increase has been seen. Instead of ₹890 billion, the government has allocated ₹900 billion. Here, two initiatives have been announced by the government. First, the Ayushman Bharat scheme will be expanded and second, they have focused on the cervical cancer vaccine too.

Housing and Economy

Under the housing sector, the Prime Minister Awas scheme is underway. To give affordable housing to the poor. Its allocation has been increased. Instead of the ₹795.90 billion last year, ₹806.71 billion have been allocated this year. Under this scheme, the government has also said that they will launch a new scheme for the deserving sections of the middle class. Those who live in rented houses, slums or unauthorized colonies, will be given the opportunity to build and buy their own houses.

If we talk about the overall economy, India’s real GDP growth rate, which is projected for 2023-2024, will be at 7.3%. There are two types of GDPs, friends. One is the Nominal GDP and the other is the Real GDP. Nominal GDP shows the size of the economy according to today’s prices. But in real GDP, we take inflation into account. For example, if the nominal GDP growth rate of a country is 15%, but the inflation rate in the country is 10%, then the real GDP growth rate will be 15% – 10% = 5%. But in 2022-23, India’s actual Nominal GDP growth rate is 10.5%. And our inflation is approximately 4% per cent. So the real GDP growth rate is 6.5%. This is a bit low because in December 2023, RBI had raised its projections and said that India’s GDP growth rate would be around 7%. But today, this is near 6.5%.

If we look at the estimates of international agencies for India’s GDP growth rate, they are in the similar range. In October 2023, the IMF projected India’s growth rate to be 6.3%. And for 2024-25, World Bank has projected 6.4%, OECD has projected 6.1%, and ADB has projected 6.7%. IMF has also projected that India will become the third-largest economy by 2027.

Conclusion

It is very interesting to see how different agencies identify patterns in data and predict the growth of a country. Data scientists are often tasked with this work. And this is the reason why, today data science is one of the most lucrative career options. Data and the conclusions from data have a huge impact on different industries. The figures for GDP growth rate are so important that it can cause the market to go up or crash.

The Interim Budget 2024 has laid out the government’s plans for the year. It focuses on capital expenditure, agriculture, education, healthcare, housing, and the overall economy. While the budget addresses certain areas of concern, such as infrastructure development and self-reliance in oil seeds, it also falls short in other areas like education and healthcare.

As we analyze the budget, it is important to critically assess the promises made by the government and compare them with the outcomes of previous budgets. It is also crucial to consider the impact of these policies on different sections of society, such as the middle class, farmers, and the poor. Only through such analysis can we gain a comprehensive understanding of the budget and its implications.

The government’s vision of a developed India and a $7 trillion economy is ambitious. However, it is important to hold the government accountable for its promises and ensure that the welfare of the common people is truly prioritized. By critically analyzing the budget and staying informed about the realities on the ground, we can actively participate in shaping the future of our nation.

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