Union Budget shows signs of economic slowdown, says Kerala finance minister
Balagopal highlights under 3 per cent revenue growth, significantly reduced allocations, and US-driven policy pressures posing risks to India’s economic stability
Kerala Finance Minister KN Balagopal on Tuesday (February 3) cautioned that the Union Budget exhibits an alarming trend, suggesting that the economy is likely heading towards a recession.
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Speaking to PTI Videos on the sidelines of a function where he gave a comparative analysis of the Kerala State and Union budgets, he noted that the central government’s total revenue receipts rose by just Rs 1 lakh crore this year, an increase of under three per cent.
Revenue growth falls short
“The Union Budget shows a tendency towards recession. Though an economic slowdown has not been announced, there are signs that the economy is heading towards a slowdown. This is a matter of great concern. Last year, the total revenue receipts of the Union government were Rs 38 lakh crore, and this year they have increased by just one lakh crore, which is less than three per cent growth,” he said.
Balagopal said that the annual growth in revenue receipts usually exceeds three per cent. “Some of the estimates that we have included in the budget may not be achieved. In such a scenario, next year the Union government will receive the same revenue receipts as it has this year. When that happens, it means the receipts will decline in real terms,” he said, indicating a probable slowdown in the Indian economy.
He said that the Union Budget had reduced funds across all sectors. “They have reduced Rs 58,000 crore in MGNREGA alone. Funds have also been cut for school education and health, as well as diesel and petrol subsidies for pumps,” Balagopal said.
The Kerala finance minister said that the Union government had even failed to disburse the funds allocated for projects in the previous budget. “For the Jal Jeevan Mission, they allocated Rs 67,000 crore last year, but only Rs 17,000 crore was released. When they did not pay us for the implementation of this project, we had to borrow Rs 5,000 crore, as the contractors were not receiving payments,” Balagopal said.
Slams Union govt policies
He reiterated his concerns over the possible recession scenario, saying that Kerala cannot insulate itself when the Indian economy is heading towards a dangerous situation.
“World politics is in a strange situation. We cannot sit alienated as the policies of the central government will affect us as well. The policies of the Indian government are going to destroy our economy,” Balagopal said.
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Accusing Prime Minister Narendra Modi of working to keep US President Donald Trump happy, he alleged that the United States was dictating terms to India through tariff deals.
“The US is dictating to us that we should buy their products at prices they quote, sell our products to them at prices they decide, and sell our products in our own country with taxes they determine,” the minister said.
The Kerala FM also said that despite the state government putting forward several demands, including demands for industries, especially in sectors such as defence, the Union Budget had completely ignored the state.
(With agency inputs)