Gender-responsiveness of Union budget 2023
Dipa Sinha is an Assistant Professor at the School of Liberal Studies, Ambedkar University Delhi (AUD). Before joining AUD, she worked with the Office of Commissioners to the Supreme Court, Centre for Equity Studies and Public Health Research Network, and is actively involved with the Right to Food Campaign. She has worked on issues related to food rights, nutrition and public health. Dipa was a member of the Project Team for the report on Nutrition and Food Systems (Committee on World Food Security, FAO).
The talk focused on spending by the government which has an impact on women, especially in the social sector. The two takeaways from the Union Budget:
- Crowding-in of investment and reduction of fiscal deficit. The question arises as to which sector the spending has been being cut.
- One of the seven priorities (Saptarishi) is the empowerment of women as one of the agenda
India’s current macroeconomic scenario shows a K-shaped recovery; growth slowdown (a pre-pandemic trend) and stagnant real wages. The excess capital spending seems to be made at the cost of expenditure in the social sector. Moreover, the components of capital expenditure where investment has increased are:
- Energy – laying of pipelines
- Transportation – construction of highways
- Communication – postal services and other services
It must be noted that increasing capital expenditure does not directly create employment as the sectors are mostly mechanized. It does not directly and immediately create employment. Though it can be argued that it can revive the economy in the long run. This holds true for the social sector as well. Thus, it can be questioned why to choose capital expenditure over investment in the social sector. This is where the vision of the government about growth and development is clearly visible. When capital expenditure is expanded, investment is mainly made at the top and reaches the bottom gradually. Thus depending on trickle-down economics works in favour of large corporations and there is no direct focus on generating employment. On the other hand, increasing spending in the social sector will directly increase employment opportunities as it is a labour-intensive sector. This would increase their basic expenditure as money will be spent on basic necessities (like soap, and toothbrushes). Thus helping revive the economy too.
Given that inclusive development is one of the saptarishis, health, and education could have been the focus areas where the government could have increased budgetary allocations. This would have been inclusive in nature and increased the productivity of the economy. Also, the tax on corporations after adjustments is regressive in nature. Large corporations effectively have lower tax rates imposed on them than smaller ones. The payment to the Food Corporation of India has been reduced and they have been asked to borrow from the open market. The latter portrays a picture of inefficient functioning which necessarily need not be true.
Some of notable points regarding spending on various schemes as seen in the latest budget are:
- Increase: Jal Jeevan Mission
- Almost no change: Saksham Anganwadi, Poshan Abhiyan, a scheme for adolescent girls, National Social Assistance Programme
- Decrease: Mid-day meal scheme, Samarthya, ICDS, MGNREGS, PM-POSHAN
Key Takeaways
The extent to which an increase in capital expenditure can lead to employment generation is questionable. Since spending is mainly on highways and railways, which are capital-intensive sectors, an increase in wage work is unlikely. The priority of the government is to maintain the fiscal deficit which will keep the foreign investment intact and which will contribute to decent ratings by international organizations and parameters like ease of doing business. An alternative could be to spend on schemes like MGNREGA or on food subsidies which can revive demand. Also, improving public and health infrastructure can lead to human development which will in turn increase productivity and generate employment opportunities.
Watch the recording here
