(The author is the member of National Executive Committee, BJP)

The first budget after the rollout of GST and the last full budget of the Narendra Modi government in its first term in office, with a year and half to general election, has evoked mixed reactions. After initial remarks like “what is there in it for me”, people are now appreciating the fine print.It would be wrong to say that the budget caters only to the farm sector or rural economy. Agriculture and rural sector have been the backbone of every economy in the world and especially so in India. The revival and dominance of the Chinese economy started with the strengthening of the farmers. Even developed economies give special and protectionist treatment to agriculture. Reviving and strengthening the agriculture sector and rural economy have become very important for the present government, given the fact that elections are increasingly being influenced by rural voters more than urban voters.Even from sheer economic prosperity point of view, the Indian economy probably depends more on robust rural and agricultural growth than it does on industrial production and services sector. Little wonder that the finance minister has more than once emphasised that agriculture will be the prime area of focus.All the proposals pertaining to rural and agriculture sector will have a cumulative effect on optimum farm support price, will augment farm output in a risk-free atmosphere and encourage the already buoyant agricultural exports (worth Rs 2 lakh crore now). To say that this budget is only about farmers grossly underestimates its potential.In fact, no budget can have a lopsided approach and totally neglect the urban population. Besides, an allround approach towards economy cannot entertain a stratified view of budget such as urban-rural, agriculture-industry and various income brackets. These groups are becoming increasingly dynamic and the differentiating lines among them are thinning fast. In order to make an effective impact assessment of the budget on the so-called “middle class”, it is essential to determine who actually constitutes it?Actually, there is no clear definition of the term, middle class, in India. If we go by recently mined figures, the number of people to be classified under this category comes down drastically. Another study, made about 10 years ago, using the definition of real annual household disposable income, puts this number at 50 million.Yet another study using consumption-based household criteria (car, scooter, television, telephone or mobile), estimated the middle class figure at approximately 20% of the population or slightly over 200 million people. Meanwhile, the World Bank in 2005 estimated the middle class at 264 million, using the median poverty line in 70 countries at the lower extreme ($2 per day) and the US poverty line ($13 per day) as an upper extreme. Even if we presume that the middle class is about 24 million, all of them do not come under one income group or economic strata.Similarly, the standard of living also varies from state to state. Although the Indian economy has been witnessing a steady growth in the last two decades, it has been uneven with reference to various social and economic groups and also different in geographical units of measurement such as rural, urban, semi-urban and urban clusters around capital regions irrespective of industrialisation or the lack of it. For example, the GSDP growth rates of Andhra Pradesh, Bihar and Madhya Pradesh for 2015-16 were higher than those of Maharashtra, Odisha or Punjab.The limited point that is being attempted to be made here is that the slogan “middle class got nothing” is more of a perception war than reality. Going by the tone and tenor of the Union budget, the aim seems to be to lay a strong foundation for a better future. It is true that the popular expectation was that minimum income exemption for tax purposes would be raised to Rs 3 lakh. The present finance minister had himself demanded to raise it to Rs 5 lakh when he was speaking as leader of the opposition in Rajya Sabha in 2014. Having said this, it should be recognised that the budget has ensured that the entry-level income tax is one of the lowest in the world. A person earning, say, about Rs 42,000 per month will pay 5% income tax. With the present exemptions, incomes up to Rs 2.9 lakh attract no tax. The provision of standard deduction of Rs 40,000 for salaried taxpayers will result in increased disposable income.If we consider the senior citizen component of the taxpaying class, income from interest up to Rs 50,000 is tax-free. Deductions for health insurance premium of senior citizens have been raised from Rs 30,000 to Rs 50,000. These two provisions taken together will entitle a tax-free income of about Rs 50,000 to a senior citizen. Deductions for senior citizens with critical illnesses have been raised from Rs 60,000 to Rs 1 lakh. The finance minister has proposed to bring nearly 95% of the corporate entities — mainly associated with micro, small and medium business enterprises with an annual turnover of less than Rs 250 crore (instead of the earlier turnover limit of Rs 50 crore) — into the ambit of the lower 25% corporate tax rate. This will not only boost their confidence and profitability but also their employment potential.The budget has also sought to introduce measures for increasing the scope of futures and options. This proposal will help the farmer net greater income post harvest and also result in increased volumes of trade benefitting the markets and commodity market investors, who are mostly in urban centres. Increasing the scope and effective implementation of the Electronic National Agriculture Market (e-NAM) will generate jobs in back-office operations, which were essentially an urban phenomenon a few years back before that bubble burst.A large chunk of the “middle class”, very active in social media, has been clamouring for the boycott of “foreign goods” (read Chinese goods). Now, when the duty structure on imported electronic products is increased, imported mobile phones are bound to cost a little more. But this will also spur the companies to shift their manufacturing processes to India, facilitate technology transfer and create more skilled jobs. After all, the prime minister is committed to give a boost to Make in India and improve the atmosphere to encourage entrepreneurship among the youth. As the budget proposals are implemented, the apprehensions will wither away and the intended benefits of the proposals will stand out, resulting in holistic development.