KM Sethi
The budget presented by Finance Minister KN Balagopal is a showcase of the development vision and activities of the Left Democratic Front (LDF) government as well as its short-term and long-term strategies to achieve them.
But the minister himself raised questions on this Care The ability of the state to assess expectations and reality is an unexpected, if not unknown, area of growth.
With the onset of a series of setbacks starting with the introduction of the Goods and Services Tax (GST) regime, demonetisation, reduction in fiscal federalism, two rounds of natural disasters (in 2018 and 2019), COVID-19 and, finally, With the start of the Ukraine war, the long-term prospects for Kerala’s economy are anything but comforting. Still, there is a silver lining to the document. This is clearly evident in the new schemes implemented in many sectors ranging from higher education to information technology, health to agriculture, industry, fisheries, cooperatives.
Admirably, a major crisis for government today is how to negotiate the challenges of a neoliberal regime (charged from the center as well as international financial institutions), the recessionary trends emerging from the global economy and the interventionist evolutionary/welfare Agenda State.
Amidst the rising budget deficit and mounting debt of the state, the success of the government lies in the approach that we cannot keep ourselves in a fear-psychotic mode, but look forward to the future with all liabilities. This is what the finance minister has inherited from ‘Isaac’s magic’.
Former Finance Minister TM Thomas Isaac has no hesitation in telling you openly that ‘money is not a problem’ in any development project. In fact, his conception of the Kerala Infrastructure Investment Fund Board (KIIFB) – which as usual drew up a business schema – was instrumental in instilling confidence in ‘doing business’ in all sectors of the society and economy.
Of course, Mr. Balagopal’s budget speech has indicated, in particular, that KIIFB has a circuitous trail in all major development projects, including infrastructure for higher education/knowledge economy, regardless of “how and who” should ultimately last in the long run- Fixed liabilities by way of interest and repayment.
The objective of the budget is to bring about significant changes in the higher education sector to ensure that research payments are used beneficially for the productive sector of the state. “When Mr. Balagopal says that the quality of higher education “should be enhanced to be beneficial to practical life rather than confined to academic circles,” he conveys a message that universities and research institutions must be cost-effective and This should be encouraged for their production in the context of ‘production’.
The proposal for “Translation Labs and Incubation Centers to Promote Entrepreneurship” is a clear indication of the direction in which universities will have to move. Some of these things definitely follow the development path of the central government. But it is not clear whether the state will be in line with the National Education Policy (NEP) 2020, which emphasizes multidisciplinary universities, colleges and liberal arts programs.
The opportunities for setting up IT hubs, science parks etc. are very well understood in an ecologically fragile state like Kerala, where one cannot keep large industries that have the potential to ruin its ecology. However, when the emphasis is on the “knowledge economy” with the goal of increasing the “value-added output of the state and its household income”, we cannot be sure that liberal arts and multidisciplinary programs should follow this principle. Must adhere to, “existence of the fittest.” The new budget is silent on the existence of many universities and institutions of higher education, where one can find consistently disproportionate allocations between the sciences, social sciences and humanities. This can be seen in the approval of new programs and courses.
The budget is unquestionably in line with the thinking that there should be strong government intervention in various sectors of the economy affected by the global recession, pandemic and return migration. Therefore, the top priority is a silver lining to regions shattered by global reversals.
While the allocation may not be enough to control inflation and ensure food security, it is a worthy start in terms of state intervention, as in the case of subsidies given to rubber cultivators. The productive areas of the state have immense potential for development and we have enough manpower and technology to manage them. But the most challenging task is how to generate capital, invest in critical sectors and ensure proper marketing.
With KIIFB in hand, the present government is very confident of moving forward. This is a welcome move to diversify the market strategies (including cooperatives), keeping in mind the locally vibrant regions.
(KM Sethi is ICSSR Senior Fellow and Director, Inter University Center for Social Science Research and Extensions (IUCSSRE), Mahatma Gandhi University).