Jaitley's Budget: How Much Politics Will He Carry in His Briefcase?

New Delhi: Two months after Narendra Modi government crossed the half-way mark of its five year mandate, Arun Jaitley will be presenting his fourth budget. Jaitley’s speech on Wednesday will not only be watched closely in financial circuits, it will also be judged on its political quotient, coming as it does just after demonetisation and just before the five state assembly polls.

That Union Budgets can fetch a few extra seats was shown by P Chidambaram in 2009 when he announced a loan waiver for farmers. This budget has been advanced by a month, and with due permission from the Election Commission, would be unveiled before the first vote is cast in Goa and Punjab this Sunday.

The political implication of this year’s budget is not so much in regard to its advanced date. It is about huge expectations associated with it.

Over the last three months, while defending demonetisation, BJP as the ruling party has presented the note ban as some sort of panacea which will rectify both social and economic distortions in society. Naturally, people would want the government to deliver. And deliver now, when the biggest policy statement of the government is unveiled.

For those who stood quietly in long queues outside banks, this probably would be the moment of deliverance. Garibi Hatao 2.0. Especially in states like UP which witnessed some initial distress after note bandi due to low banking density. People here will get a chance to deliver their verdict on the issue sooner than the others, for the elections are just round the corner.

Note bandi is as much a monetary decision, as it is political. It’s probably the most radical move by the BJP to pitchfork it from one side of the class divide to the other. In terms of perception, it aims to transform BJP to a poor man’s party. It aims to overwhelm the very fundamental of Indian polity: caste faultlines.

For that to happen, the gains for the poor must be tangible. Quite tangible. With many agencies predicting a slowdown - at least in the first few quarters - government will have to spur growth through public spending. Countervailing this with fiscal consolidation and curbing public borrowing to below 3 percent would be quite a task.