In her speech, the Finance Minister focused on the government’s broad achievements over the last 10 years and also gave some indications for what might be in store in the coming years, in terms of new expenditures (assuming that the NDA comes back to power). The Budget, a vote on account, did not include major announcements on the revenue or expenditure accounts. Unlike the interim Budget presented by this government before the 2019 general elections, where the PM-KISAN scheme was announced with retrospective effect, there were no grandiose announcements this time. Therefore, although the Budget does not say much, it reiterates this government’s view that the economy is on the path to recovery and gives the impression that everything is in an upswing, with much of the progress being a direct result of the policies of the last 10 years.
Poverty and income
The Finance Minister said that 25 crore people have been brought out of multidimensional poverty (MPI) in the last 10 years. The limitations of the MPI in estimating changes in poverty have been discussed extensively. For instance, the MPI does not tell us about the trends in income poverty, a useful indicator of economic well-being. While this used to be captured by the consumption expenditure survey of the National Sample Survey, no data on this are available for the period after 2011-12. The further claim that the “average real income of the people has increased by 50%” is also misleading. Average incomes are just that — averages — and do not tell us much about how the lives of the poor changed. To know about the incomes of the majority of the people, what really matters is the distribution of the national income.
