Interim Budget for 2019-20: Farmer first

​New Delhi: In a stark departure from the past, Narendra Modi government converted a customary Interim Budget for 2019-20 before elections into full-fledged budget by announcing an annual cash dole-out of Rs 6,000 to small farmers and a scheme for providing monthly pension of Rs 3,000 to workers in the unorganised sector besides tax concessions for middle class. Announced with an eye on upcoming elections, these sops are expected to benefit both middle-class and farmers, whose disenchantment was said to have cost the BJP dearly in recent assembly elections.

As was widely anticipated, Goyal announced an income support scheme for 12 crore small and marginal farmers by providing Rs 6,000 in their bank accounts in three equal installments in a year, which will cost Rs 75,000 crore a year to the government. The eligibility for the scheme, called Pradhan Mantri Kisan Samman Nidhi (PM-KISAN), will be ownership of less than 5 acres of cultivable land.

Though the finance minister said the scheme will be implemented from the current fiscal year, where it will cost Rs 20,000 crore, it wasn't clear how the beneficiaries would be identified. A mega pension scheme was introduced to provide a monthly pension of Rs 3,000 with a contribution of Rs 100 per month for workers in the unorganised sector after 60 years of age. This scheme is estimated to benefit 10 crore workers across the country.

The farm income support scheme and other sops will result in the government breaching its 3.3 per cent fiscal deficit target from the current year and slipping on 3.1 per cent target for the next. Fiscal deficit for both the years has been put at 3.4 per cent of the GDP.

Wooing farmers, an interest subvention of 2 per cent to those pursuing animal husbandry and fisheries and to farmers hit by natural calamities was announced in the Budget. An additional 3 per cent interest subvention will be given to farmers for timely repayment of loans.

While defence allocation has been raised by 7 per cent to over Rs 3 lakh crore, subsidy bill has gone up to Rs 2.97 lakh crore from Rs 2.66 lakh crore. Target for revenue from disinvestment of government stake in PSUs has been raised to Rs 90,000 crore from Rs 80,000 crore and dividend from the RBI and other banks has been pegged at Rs 82,900 crore.

The NDA government, the Finance Minister said, has laid the foundation for India's growth and development for times to come. India is poised to become a $5 trillion economy in the next five years and $10 trillion economy in eight years, he added.