By Dr. Gyan Pathak
In the last 30 days, unemployment in India has risen sharply to 8.9 per cent, at a time when Union Finance Minister has started consultations with various stakeholders for preparing Union Budget 2024-25. Such an unprecedented rise in working-class distress has made the budget making exercise more challenging than expected, necessitating major changes in the Interim Union Budget 2024-25 that was tabled in the Parliament of India on February 1, 2024.
There is very wide gap between the government claim on unemployment rate in the country and the reality of joblessness on the ground. During the election campaign, the government had claimed that unemployment rate was brought down to 3.1 per cent in 2023-24 under PM Narendra Modi’s rule. However, the ground reality was just opposite. There was very high level of unemployment at 8.1 per cent in April 2024, 7.7 per cent in May, and now on June 23, it was much higher at 8.9 per cent on 30 days moving average basis, as per the Centre for Monitoring Indian Economy (CMIE) data.
Given the setback PM Modi led BJP has suffered in the Lok Sabha Election 2024, which compelled Modi to run a coalition government, the Centre needs to think twice over the continuance of the profit oriented “growth without jobs” policy this time, since it would be political hara-kiri for the BJP led coalition government, moreover because elections to the states and byelections to the Lok Sabha constituencies in two years from now can weaken the BJP in both the Upper and Lower Houses to a dangerous level. Working class of the country thus needs to be taken care of by the Modi 3.0 government.
Union Finance Minister Nirmala Sitharaman is therefore expected to correct the anomalies in her Interim Budget 2024-25 that she had tabled before the election, when the BJP was expected to perform very well, especially after the inauguration of Ram Temple in Ayodhya on January 22. However, the election result has frustrated the hope of PM Narendra Modi and the BJP. The jobs crisis in the country went against Modi and his BJP.
While job generation is still a very difficult task for the government, Budget will have to address this issue within its limitations and capabilities. Therefore, one may expect that there will be a change in the anti-labour stance of the government that the Interim Union Budget 2024-25 contained. Before the election, Union Ministry of Labour and Employment had said that the government would implement the four labour codes, but in the given circumstances, it is likely to be delayed further. The Ministry has not even provided with a full-time dedicated minister, indicating low priority of Modi 3.0 for implementation of the controversial labour codes.
The Interim Budget had come with a reduction in the total allocations for the Union Ministry of Labour and Employment and for workers’ social security schemes. It was a grave mistake, and it is expected that Finance Minister should rectify in her full budget to be tabled in the third week in July this year..
The total allocation of the Union Ministry of Labour and Employment was reduced in the Interim Budget from Rs 13,221.73 crore for 2023-24 to Rs 12,531.47 crore in 2024-25. Even allocation for the pet scheme of PM Narendra Modi, the Atmanirbhar Bharat Rozgar Yojana, was drastically cut from Rs 2,272 crore in 2023-24 to just Rs 150 crore in 2024-25. It was shocking that allotment of Labour Welfare Scheme for 2024-25 was reduced to less than half to Rs 50.68 crore from Rs 102 crore in 2023-24 (RE). It was even less than Rs 75 crore in 2023-24 (BE), and Rs 80.78 crore in 2022-23 (actual).Allotment for Directorate General of Labour Welfare Scheme was reduced to Rs 156.36 crore for 2024-25 from Rs 157.33 crore in 2023-24 (RE), much less than the budget allocation of Rs 175.78 crore for 2023-24.
Pradhan Mantri Shram Yogi Maandhan and Pradhan Mantri Karam Yogi Maandhan were other much touted flagship schemes for image building of Modi government. However, allocation of Pradhan Mantri Shram Yogi Maandhan got reduced to Rs 177.24 crore for 2024-25 from Rs 269.91 crore in 2022-23 (actual), Rs 350 crore in 2023-24 (BE), and Rs 205.21 crore in 2023-24 (RE). Budget 2023-24 had allocated Rs3 crore for Pradhan Mantri Karam Yogi Maandhan, but government spent only Rs 0.1 crore as 2023-24 (RE) shows. This scheme was allocated only Rs 0.01 crore for the year 2024-25.
These are only some examples, how Modi government had ignored the working class in its Interim Budget for 2024-25. Now with sharp rise in unemployment in the country, the Budged will have to provide some relief to the working class. The “core of the core schemes” is Mahatma Gandhi National Rural Employment Guarantee Programme. The scheme is being implemented in the rural areas and there is no such central scheme for the urban areas. When unemployment is on the rise, it was shocking that Interim Budget 2024-25 had allotted only Rs86,000 crore for 2024-25, at the level of expenditure in 2023-24, while at least Rs 2.72 lakh crore is needed to provide 100 days work in a year to job card holders.
Unprecedented worsening of the job market in the country, with ever increasing unemployment rate, rising informality of employment, and lack of social security for majority of workers in the country, remains a challenge for the Union Finance minister while preparing for the full budget. Working class distress is worsening fast, and the budget needs to address it urgently. (IPA Service)
