Karnataka Budget: CM Siddaramaiah presses infra button amid fiscal headwinds

Bengaluru: Chief Minister Siddaramaiah’s record 15th budget on Friday shunned grandiose announcements but offered enough to tell those watching that Congress’ guarantees won’t come in the way of asset creation.

With the BJP mounting a shrill campaign that the state has fallen off the fiscal cliff, Siddaramaiah had to win the perception battle by keeping his ‘Karnataka Model’ credible, and he strove to do that by announcing new infrastructure programmes while continuing to push guarantees-based welfare and human development.

After a lull, developmental activities will kick-start with Siddaramaiah allocating Rs 15,936 crore for four new road development programmes and Rs 11,000 crore for lift irrigation works, which may pacify lawmakers who have been grumbling that the guarantees had gobbled up all the money.

Siddaramaiah has bolstered his social justice plank with small, but impactful allocations for minorities, SC/STs and OBCs: Rs 100 crore for Wakf properties, a corpus fund for SC/ST patients suffering from rare diseases, new hostels for OBC students and so on. 

With the BJP gaining momentum ahead of the general elections with the Ram temple's opening, Siddaramaiah kept aside Rs 100 crore for the development of the Anjanadri Hill, the fabled birthplace of Hanuman, and residential complexes for Karnataka pilgrims visiting Thirumala, Srishaila, Varanasi and Guddapur. These goodies may shield the government from any potential salvos that the BJP may fire in the future.

Farmers, women and youth — the other key constituencies — get new schemes aimed at their economic growth. For example, women can run cafes under the Cafe Sanjeevini project while farmers will get an overarching Karnataka Raitha Samruddhi scheme for income stability.

Karnataka’s finances, however, seem precarious and it would be a big challenge to find resources to fund programmes. Just how dicey the situation is can be guaged from the fact of Siddaramaiah asking alumni to help develop educational institutions. 

This, perhaps, explains why Siddaramaiah is looking towards the private sector to invest more in public projects. Many schemes have been announced on public-private partnership (PPP). He has also announced an asset monetisation plan after having criticised the Modi administration for rolling out a similar scheme. 

The 2024-25 budget is sized at Rs 3.71 lakh crore. It is Siddaramaiah’s second consecutive budget with a revenue deficit, this time at Rs 27,354 crore, up from the earlier Rs 13,951. Also, he will borrow a whopping Rs 1.05 lakh crore next fiscal.

Defending this, Siddaramaiah said welfare schemes “tend to increase” revenue deficit, but “such expenditure is necessary to ensure that fruits of development reach the poorest of the poor”. 

"As the nation is adversely affected by steep price rise, unemployment and huge income disparities, it is the duty of the state to increase budgetary allocation towards welfare schemes which directly benefit the poor," he said.

"Hence, though I have presented a revenue deficit budget, I have increased the budgetary allocation for welfare programmes to Rs 1.20 lakh crore. This budget will pave the way for creating a new Karnataka Model of Development," he said. 

Siddaramaiah did not miss any chance to upbraid the BJP. He said the UPA government took up people-centric schemes and laws. “However, the anti-people decisions of the central government for the last 10 years has led to alarming developments such as widening inequality, concentration of wealth in few hands and crony capitalism,” he said, while recounting the "injustice" caused to the state by the Centre's policies. 

In his speech, which was boycotted by the BJP and the JD(S), Siddaramaiah repeatedly underlined that he has maintained fiscal discipline as key parameters remain legal limits. "I have belied all the prophesies of fiscal doom," he said.