A close look at the murky backdrop against which Finance Minister Thomas Issac presented the budget is in order to put things in proper perspective. A formidable array of factors were – and still are – arrayed against the State which is passing through an extremely difficult financial situation.

First and foremost has been the shockingly non-cooperative attitude bordering on hostility of the Modi Government towards Kerala. The hostility is being ascribed to what the BJP leaders call the State Government’s anti-Centre stance on various issues including the controversial Citizenship Amendment Act (CAA) and the proposed National Register of Citizens (NRC). Kerala has incurred the wrath of the Modi Government by getting the State Assembly to pass a resolution against the CAA and moving the Supreme Court against the law.

Punishment has been prompt. The unkindest cut came in the form of a drastic drop in the State’s share in central taxes. As against the State’s hopes of getting over Rs 20,000 crore, its share will only be in the region of around Rs 16,000 crore – a fall by around Rs 4,000 crore. As if this was not enough, the State drew a blank in the matter of central assistance for states affected by natural calamities. While seven other states received liberal assistance, Kerala, despite being the state hit the hardest by unprecedented rains and the resultant flood fury, got only the Centre’s cold shoulder. The arrears of GST compensation, due this year, will come only next year.

But the Kerala budget has not allowed these adverse factors to dampen the spirits. If anything, the adversity has only steeled the State’s resolve to weather the severe financial – as well as political – storms buffeting it. Given the heavy odds against which the State was fighting, the Finance Minister has come out with a budget notable for its passion – and more importantly for its compassion.

The budget has unfolded a slew of welfare measures, which have earned the grudging praise of even the carping critics and political rivals. Topping the list is the hundred-rupee increase in all welfare pensions - from Rs 1,200 to Rs 1,300. Asha workers have had their honorarium raised by Rs 500.

There is good news for primary school teachers whose allowance has seen a marginal increase of Rs 50. Similarly, the wages of school kitchen staff have gone up by Rs 50. School uniform allowance has recorded a rise of Rs 200 — from Rs 400 to Rs 600. As many as 1,000 hotels to be managed by Kudumbashree will be opened to ensure meals at the rate of Rs 25. This is part of the State Government’s laudable hunger-free Kerala project. It will also be a big relief for lakhs of people who are dependent on hotel food. At present, meals cost as much as Rs 50 and more in better part of the State.

The budget is also noted for its women-friendly programmes. An amount of Rs 1509 crore has been set apart for the welfare of women. A novel project which would be of great help to women is the decision to set up she lodges in cities.

The budget has not neglected the Non-resident Keralites who have played – and who continue to play – a stellar role in perking up Kerala’s economy. This budget has bestowed greater attention on the problems faced by the NRKs whose difficulties are likely to increase because of an announcement in the Central budget to redefine who comes under the category of NRI. The budget has taken strong exception to the move which could adversely affect lakhs of Keralites working in Gulf countries.

While the erstwhile UDF Government spent only Rs 82 crore during its five-year term, the Pinarayi Government has already spent over Rs 132 crore on NRK welfare. The Budget has focussed on a another problem faced by the NRKs on account of economic slowdown and the decision of several Gulf countries to give greater preference for their citizens in the matter of jobs. A new initiative has been the earmarking of Rs 18 crore for small investors to take care of capital subsidy and interest subsidy. The amount may be small but it is a good beginning appreciated by the NRKs. Yet another welcome measure is the announcement on skill development and training for those who aspire for jobs in Gulf countries. Last but not the least, has been the decision to earmark Rs 12 crore for ‘Loka Kerala Sabha’ (LKS) activities and the ‘’Loka Samskarika Mela (World Cultural Festival). The ‘Loka Kerala Sabha’ initiative has gone down well with the NRKs who participated in large numbers in the conference of the LKS hosted by the State.

The budget is not an unmixed blessing. It can never be. Unpleasant steps need to be taken to raise additional revenue. This budget is no exception either. The introduction of GST has severely curbed the option of states to go for tax reforms and raise revenue. The government has been forced to increase building tax and motor vehicle tax. Land transactions will also cost more hereafter. These steps are expected to generate much-needed additional income.

Among the other major steps the budget uncovers are: a package of Rs 2000 crore for rain-affected Kuttanad, Rs 1000-crore package for flood-hit Wayanad district, Rs 1000 crore for coastal area development, 2.5 new drinking water connections, one lakh new houses, 1,50,000 new job opportunities and Rs 3025 crore for Kochi metro.

In sum, the budget is the best that a finance minister functioning against overwhelming odds can come up with. No wonder, it has earned all-round praise, with the exception of critics who only see the negative picture. (IPA Service)