Beyond numbers
Budget speech should have been fact-checked
Finance Minister Nirmala Sitharaman, in her presentation of the Union Budget for 2020-21, sought to restore trust in the Indian government’s numbers. Concern has built up over such matters as the scale of the fiscal deficit, the actual growth performance, and the extent of unemployment. She deserves credit for making elements of extrabudgetary borrowing much clearer, and the government has also set up a committee to examine how its official statistics are produced. This is, in effect, a recognition that the credibility associated with official pronouncements has been undermined, and there is a need to recover it. Such an effort is particularly important at a time when India is increasingly depending upon foreign capital to fill the gap caused by a collapse in private investment and overspending by the government.
While this effort towards credibility is praiseworthy, it is important to note that it has to extend beyond the question of growth and budgetary numbers. Credibility emerges from the entire set of statements that surround such matters as a Union Budget. In the past, every word and fact that went into the Budget speech was known to be true, and could if necessary be footnoted and backed out of official documentation. However, there were elements of the Budget speech that stood out this time as clearly not having gone through such a process. An introductory section that mentioned that 271 million people had been lifted out of poverty in the decade between 2006 and 2016 is worth considering as an example. That number emerges from the United Nations Development Programme’s report on multidimensional poverty. It would have been better to have relied on the official Indian numbers for poverty, to give a clear sense of what the state’s own perception of its achievements are. The same section also provided various numbers for growth and inflation in various decades that were frankly incoherent. There is little doubt that growth over the past two and a half decades has been robust, on average, and that in recent years, inflation has largely been controlled. These points could have been made without appearing to stretch the data unduly.
Elsewhere in the speech, there were points that simply undermined the seriousness of the occasion and made the government look ideological and amateurish. For example, in a section dealing with trade, the speech mentioned that seals from the Harappan civilisation had been deciphered: “Words from the Indus Script hieroglyphs have been deciphered. Commerce and trade related words show how India for a millennia is continuing as rich in skills, metallurgy, trade etc.” One of the examples provided was of the name “Sethi”, which in modern India is associated with those who traditionally work in wholesale trade. The Budget speech claimed that this name was also visible on seals from the Harappan civilisation — a claim that is at best not peerreviewed and at worst ideologically tinged. There is every reason to suppose ancient Indian civilisations were maritime-oriented and trade-intensive — the archaeological record is evidence enough. There is no reason to make claims of this sort that undermine the seriousness of the Budget speech and raise eyebrows all around.