Explainer: If Congress government is formed, how much will be spent on fulfilling the promises, will the economy be boosted? , If

Congress has issued ‘Nyaya Patra’ Image Credit Source: TV9 Graphics

It has been 10 consecutive years that Congress has been out of power. Meanwhile, its support base has declined rapidly, while the opposition party BJP has expanded. Still, one thing goes in favor of Congress, that is that people know its name from every village, taluka, town to city of the country. He is not facing any crisis of name or identity. In such a situation, Congress has released its manifesto giving ‘5 justices’ for the Lok Sabha elections. It has been named ‘Nyaya Patra’.

Now if the Congress government is formed, will it be economically viable for it to fulfill all the promises made in it? Will this strengthen the country’s economy? Where will the government bring money for this? Let us understand it in detail…

The five justices talked about in the Congress manifesto include women, youth, farmers, workers and participatory justice. Talks have been made for them like starting many schemes and guaranteeing jobs. Along with this, a preamble of three new resolutions ‘Work, Wealth and Welfare’ has also been presented for what the work culture of the new government will be like. If the economic review of the schemes announced by Congress is done, then economy experts highlight different aspects regarding it.

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Major schemes of Congress manifesto

Congress has mentioned many types of schemes in its manifesto, in which there is mention of Mahalaxmi Yojana which talks about giving unconditionally Rs 1 lakh annually to the poor women of the country, pension to the elderly, subsidy on railway tickets, all Health insurance up to Rs 25 lakh, increasing the health budget to 4 percent of the total budget in 5 years, 100% vaccination of children.

Congress released manifesto (Photo: PTI)

In the manifesto of Congress, maximum focus has been given on ’employment guarantee’. In this, a National Apprenticeship Program is to be started for the youth, in which it has been said that an honorarium of up to Rs 1 lakh will be given every year to diploma and graduates. Waiver of education loans along with interest till March 15, 2024, providing 30 lakh government jobs, monthly assistance of up to Rs 10,000 to sports persons, separate employment guarantee law for the urban poor and increasing the daily minimum wage for MNREGA to Rs 400. etc. are included.

Apart from this, it has provided Rs 6,000 monthly as Universal Basic Income. These are such schemes for which any government will have to spend heavily on the budget.

Will the new government be able to bear the expenses?

One thing is not clear about the announcements made by the Congress that how many people will get its benefits, but if the present government’s ‘Garib Kalyan Anna Yojana’ is considered as the basis, then there are about 80 crore poor people in the country. To whom the government is giving free ration. If these are divided into family units, then there are about 16 crore families to whom the government is giving free ration.

Dr. Sudhanshu Kumar, associate professor and well-known economist at Bihar Institute of Public Finance and Policy, Patna, says that Congress has announced to give Rs 1 lakh annually to women from the poorest families. If the calculation is done keeping in mind the figures of these 16 crore families, then the government will need Rs 16 lakh crore annually for this alone.

Congress leader Rahul Gandhi (Photo : PTI)

He said that apart from this, Rs 8-10 lakh crore will be required to complete apprenticeship, 30 lakh government jobs, MNREGA, education loan waiver and other announcements. In this way the matter will be worth around Rs 25 lakh crore. The country’s budget is around Rs 47 lakh crore, hence the government will not face any problem in meeting its expenses, but for that the government will have to work in a very efficient manner. However, Congress has talked about tax reforms in its manifesto, which may impact the government’s revenue collection.

Arun Kumar, professor of economics at Jawahar Lal University, says that the Congress manifesto targets the lower income group population of the country. Its focus is on increasing employment. If employment increases in the country, then people’s income will increase and it will generate demand in the economy, in which we are seeing a decline since 2017 and hence uneven growth is seen in the country. On the question of where the money will come from for this, he says that it is suitable for the country’s economy and the government to bear these expenses, it is just a matter of difference in priority of the government.

Where will the money come from for expenses?

Dr. Sudhanshu Kumar says that Congress has talked about bringing GST 2.0. If the Congress government collects GST at a single rate in GST 2.0, then to make it revenue neutral (so that it does not affect the existing income of the government), it will have to impose tax at the rate of 29 percent, which will be impossible for any government. . In such a situation, if the government keeps the GST rate at 18%, then the revenue of the government will decrease, then it will be difficult for the government to bear the expenses of the schemes.

Rahul Gandhi in Bharat Jodo Nyay Yatra (Photo : PTI)

Dr. Sudhanshu also says that managing the revenue deficit has been a difficult task for the current government. Many schemes like free ration, subsidy to farmers, Kisan Samman Nidhi are such schemes which will be difficult for any government to stop. In such a situation, it will be difficult for the government to decide to give lump sum subsidy by stopping other subsidy money. In that situation, management of revenue deficit will become a new challenge for the government and the country’s economy may even go back to the 1991 era.

Professor Arun Kumar presents a different perspective on this issue. He says that the Congress manifesto has been made targeting 94 percent of the country’s population. It does not offer policies for only 6 percent of the rich population. When a poor man gets money, he spends up to 90 percent of his income. Whereas when a rich man gets money, he spends only 5 percent of his income on consumption. This reduces or unequal the demand in the economy.

Pro. Arun Kumar says that even if the Congress government reduces the GST rate, revenue collection will increase due to increase in demand in the market. At the same time, due to increase in people’s income, the direct tax collection of the government is also expected to increase. Due to employment generation, demand will be created in both the organized sector and unorganized sector of the country. The current policies are very much on the supply side, whereas what the country needs is demand. He says that due to decline in consumption in the country, its real GDP growth is currently only between 1 to 2 percent.

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Brijesh Pratap
Brijesh Pratap

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