A crisis is an opportunity, and the context of Kerala's budget for 2024 was configured for such spectacular and solid announcements. Of course, the budget is not the platform to announce policy reforms, but finance ministers have used the platform to indicate policy directions. In the Kerala budget, the Finance Minster has chosen to maintain the status quo in its content and approach.
Though the announcement "Programmes are being planned to attract investment to the tune of at least Rs 3 lakh crores within the next three years" generated a lot of interest at the beginning of the budget speech, no clear road map was laid out in the presentation.
One exception would be admission to foreign and private universities in Kerala, but that needs wider political acceptability and recognition from the political leaders across party lines to attract investors.
Other welcome steps include those on ease of starting a business, land pooling, infrastructure development for entrepreneurial activities, and announcements for converting Kerala into a hub of higher education, medical innovations, and industry.
However, it all depends on how the mission modes work to convert them into real-time plans.
Such announcements lack conviction these days given that Keralites have been used to them for some time.
Moreover, the lack of convincing resource mobilisation and management plans adds further woes to the state's public finances.
The claim of registering 1,00,000 enterprises last year and creating employment for 3,00,000 reflects how we fail to visualise scaling up industries that can grow into the companies offering thousands of jobs and a sizable balance sheet. Our startups need to be supported by such bigger plans and conducive ecosystems.
Some announcements, such as Investors Meet, Higher Education Transformation Initiative–Global Conclave, Maritime Summit, AI Summit, Robotic Conclave, etc., serve the need of the hour. But they require preparation and vision plans to realise the outcomes envisaged.
An announcement of Rs 250 crores for the development activities of the Digital University is a welcome step, and one could wish for more industry partnerships and openness towards realising the potential of other universities similar to the Digital University’s roadmap.
Kerala’s plan to become a care hub for people from around the world for retirees could give a significant fillip to the economy. This will help with medical and education hub prospects too.
An announcement of Rs 3 crore to the universities to look into the modernization of supply chain management with the incorporation of the latest technologies into retailing is also a welcome move to support the small-scale service providers of the state.
Most sections of Kerala society are mentioned in the budget and given an allocation.
The budget still does not clarify the debate on resource mobilisation and fund management.
Given the low spending and utilisation of the budget allocation, mostly due to the lack of funds with the government, the current financial year warrants an assurance and plan from the government.
The FM's financial statement demonstrates that Kerala's expenditure is not increasing. But it also shows Kerala's poor tax collection and capital expenditure.
The FM could have announced the selling of shares of PSUs to bring a refreshing approach to Kerala’s ecosystem.
The impact of the development of National Highways could have been multiplied by announcing the private operators' entry into public transport.
Accepting the private operators' role in public transport and making policies to that effect can generate a lot more taxes and employment. It can also ensure sustainability and upward mobility of society.
Kerala is going through a transformation in terms of its global outlook, enhanced by better education, diaspora, and remittance. The state is getting urbanised fast, and the youth are very aspirational. If they continue migrating, it means the budget has neither convinced nor satisfied them.
The challenge for the government is to give them a positive outlook about the future by meeting the goals of expenditure, expectations, and effectiveness.
(Views are personal.)
Dr D Dhanuraj is the Chairman of the Centre for Public Policy Research, a think-tank based out of Kerala.
