Karnataka CM presents populist budget ahead of Assembly elections

Announced Infra projects, Namma Canteens for workers, Rs 6,000-cr grant to OBC, SC and ST people

Karnataka Chief Minister Siddaramaiah turned populist in his last Budget, ahead of the Assembly elections next year. He announced infrastructure projects for Bengaluru, announced Namma Canteens for urban workers and announced a Rs 6,000-crore grant to other backward communities (OBCs), Scheduled Castes and Scheduled Tribes.

The Budget proposal comes at a time when Karnataka's gross state domestic product is expected to grow slower at 6.9 per cent from 7.3 per cent on account of a decline in growth in services and manufacturing. The services sector, largely software exports, was expected  to grow to 8.5 per cent, from 10.4 per cent last year. Industrial growth was expected to reduce by half to 2.2 per cent from 4.9 per cent last year. This did not dither Siddaramaiah from rolling out sops, including cutting down taxes on beer and wines and capping movie tickets at Rs 200. He also announced several infrastructure projects for Bengaluru, a city plagued with challenges, including poor roads, public toilets and pavements. The highlight was the canteen, a plan to provide urban workers in every locality breakfast for Rs 5 and Rs 10 for lunch and dinner, replicating a hugely successful model by former Tamil Nadu Chief Minister J Jayalalithaa, that helped her return to power with a huge majority. He also said laptops would be given to 150,000 students joining engineering, medical, polytechnic and degree colleges across the state in the new academic year.

“We have waived Rs 2,359 crore towards crop loans availed by 10.7 lakh farmers from cooperative societies since 2013-14 as against Rs 940 crore waiver given to 400,000 farmers from July 1, 2011, to July 25, 2012, by the previous government,” said Siddaramaiah, taking a dig at the previous BJP government that was riddled with scams.

Siddaramaiah is leading the last big state where the Congress is in power, which he won in 2013 by capitalising on the negative sentiments against the BJP. The influence of the Reddy brothers on former chief minister B S Yeddyurappa and corruption charges against leaders had led to BJP’s downfall in the state.

The Congress is facing similar charges, with the Opposition leaders saying that Karnataka has become the party's cash cow for its campaigns in other states. Siddaramaiah will face a test for his leadership in April, when bypolls are held for two Assembly constituencies in Mysuru, his stronghold. "The last four years of our journey was not a bed of roses. We are facing an adverse situation because of a slump in economic activities, including drought for two years, and demonetisation, which is being countered through fiscal discipline, commitment to resource mobilisation and efficient administration," said Siddaramaiah presenting his 12th Budget as the state’s finance minster and fourth as the chief minister since May 2013.

The budget has earmarked Rs 600 crore in FY 2018 to provide protective irrigation to crops during the critical stages to combat drought and obtain higher income.