Projecting the “Karnataka Model” of development as an example, by focusing on the five guarantees that Chief Minister Siddaramaiah promised would ensure positive changes in the lives of crores of people — mainly women and marginalised sections — the State Budget for 2024-25 sought to demonstrate that welfare has the pride of place in the Congress government.
Revenue deficit
Ahead of the Lok Sabha 2024 elections, Mr. Siddaramaiah has not levied any new taxes. The Budget pegged borrowings at ₹1,05,246 crore, which is 28% of the Budget size of ₹3,71,383 crore in 2024-25. Revenue deficit is expected to touch ₹27,354 crore.
Mr. Siddaramaiah, who holds the Finance portfolio, presented his 15th Budget in the Legislative Assembly on Friday which not only provided financial support for five guarantees, aimed at achieving equitable distribution of wealth in society, but also added more schemes for the welfare of women SHGs, gig workers, and anganwadi workers. A sum of ₹1,20,373 crore was allocated for various welfare programmes.
Targeting Centre
In a over a three-hour-long speech replete with criticism of the Centre, Mr. Siddaramaiah defended the five guarantees and hit out at the Central government’s “anti-people” policies for the last one decade, which, he said, had led to widening inequality, concentration of wealth in few hands, and “crony capitalism”.
The State government had undertaken the work left undone by the Centre which had abdicated its responsibility, he charged.
The Chief Minister’s tirade against the Centre left the BJP and the Janata Dal (S) fuming, and both staged a walkout from the House terming the Budget as “empty”.
Spending on guarantees
Mr. Siddaramaiah, stating that the guarantee schemes were not an “election gimmick”, hit out at the Opposition for their criticism, saying that they rest on the soaring aspirations of the people. The Budget proposed to spend ₹52,000 crore on five guarantees – Shakti, Gruha Jyothi, Gruha Lakshmi, Yuva Nidhi, and Anna Bhagya.
The Chief Minister justified the government’s “welfare approach” by citing principles advocated by B.R. Ambedkar and Basaveshwara. Apparently referring to “Modi guarantees”, he found an irony in the same people who criticised guarantees as “Bitti Bhagyas” had now “stolen” them and were trying to implement them as their own. For the first time, the Preamble of the Constitution was used as the front cover page of the Budget book.
Guarantees ensured an average income of ₹50,000 to ₹55,000 to each family every year, which would reduce inequality and bring prosperity and dignity to lives of vulnerable people, said the Chief Minister.
The Budget displayed an 18% increase in GST and 12% growth in State-own taxes, which were largely owing to positive effects of guarantees by increasing the disposable income in the hands of the people.
Continuing his criticism of the Centre, Mr. Siddaramaiah took a dig at the Narendra Modi-led government for “unscientific” implementation of GST that caused loss of ₹59,294 crore to the State during 2017-2024.
He criticised the Centre for meeting out injustice to the State in the devolution of taxes, cesses, and surcharges (₹45,322 crore during 2017-24) and non-release of drought relief.
For Bengaluru, some of the infrastructure initiatives in the Budget were the repositioning of the peripheral ring road as Bengaluru Business Corridor to decongest traffic to be developed at a cost of ₹27,000 crore on PPP model, a 250-metre-high Skydeck in the city, and permitting shops and establishments to remain open till 1 a.m. in Bengaluru and 10 other city corporations to boost trade and commerce.
The Budget proposed to bring out eight new policies and they are: Skill Policy, Gram Panchayat-SHG Convergence Policy, Green Hydrogen Policy, Industrial Policy, Textile Policy, Global Capability Centres Policy, AVGC-XR Policy, and Tourism Policy.
Of the total expenditure, the revenue expenditure was estimated at ₹2,90,531 crore and capital expenditure estimated at ₹55,877 crore. The fiscal deficit was estimated at ₹82,981 crore, which was 2.95% of GSDP and the total outstanding liabilities of the State was estimated to reach ₹6,65,095 crore in 2024-25, which is 23.68% of GSDP. The estimated receipts, including loans, was estimated at ₹3,68,674 crore, in 2024-25.
The Chief Minister said: “Though I have presented a revenue deficit Budget, I have increased the allocation for welfare programmes ... I am confident of achieving a revenue surplus after two years.”
