Indian Communists call Union Budget "anti-people" and "detached from the concerns of the masses"

Indian Finance Minister Nirmala Sitharaman presents budget -- image cropped from news video screenshot

Both the Communist Party of India (CPI) and the Communist Party of India (Marxist) (CPI(M)) have released statements condemning the new Union Budget.

Budget Priorities Detached from the Concerns of the Masses

The National Secretariat of the Communist Party of India issued today (February 1, 2026) the following statement:

The Union Budget once again reflects the government’s refusal to confront the real economic crisis facing the country. At a time when global uncertainties, geopolitical instability, and trade disruptions are intensifying, the Finance Minister’s speech offered no roadmap to insulate the Indian economy or protect livelihoods. Instead of clarity, the Budget was marked by deliberate vagueness. The Finance Minister avoided giving scheme-wise allocations to major flagship programmes, signalling opacity and an attempt to hoodwink Parliament and the people by hiding cuts behind grand announcements.

The Economic Survey itself acknowledges that India’s growth is being driven primarily by domestic consumption. Yet the Budget completely fails to stimulate demand. In rural India, this failure is evident in the continued neglect and systematic destruction of the social sector. The previous financial year witnessed the dismantling of MGNREGS, once the backbone of rural livelihood security, and its replacement with the contractor-driven VB-GRAM-G Act, which undermines wage employment, decentralisation, and workers’ rights. In urban India, demand remains suppressed as the government refused to provide any meaningful income-tax relief to working people and the middle classes.

The agrarian crisis continues to deepen. The legal guaranteed of MSP, the single most important policy intervention required to stabilise farm incomes, remains elusive despite repeated assurances. Workers across sectors are on the streets protesting against the four anti-labour codes that weaken collective bargaining, social security, and job protection. Meanwhile, health and education remain in a state of neglect, with public investment stagnating and the government’s singular focus being privatisation and corporatisation, further excluding the poor and marginalised.

India’s manufacturing sector, which alone can generate large-scale employment for the masses, continues to show unsatisfactory growth, aggravating the already severe unemployment crisis. While the Finance Minister mentioned the term “AI” eleven times in her speech, there was no concrete articulation of policy, investment, or institutional capacity building in a sector where India is lagging far behind other countries. Under the BJP, AI appears to stand not for Artificial Intelligence, but for Administrative Inertia, symbolising a directionless governance that substitutes buzzwords for vision and slogans for solutions.

The Polit Bureau of the Communist Party of India (Marxist) has issued the following statement:

A Thoroughly Anti People, Anti Federal Budget

The ninth Union Budget presented by the Finance Minister in Parliament today was a stark testimony to the uncritical commitment of the Modi Government to promoting the narrow interests of a few big business houses and the rich and the wealthy, at the cost of the working people and socially oppressed sections of society, as well as larger national economic interests. The 'fiscal discipline' that Nirmala Sitharaman claimed as a credit for the Government has always been another way of describing tax concessions to the corporate sector and the rich, while squeezing expenditures necessary for improving the conditions of the working people. This has expressed itself in the current year and the budget for next year by a massive contraction in revenues and slashing of expenditure.

In 2025-26, the year that is now ending, tax revenue realizations have fallen far short of even the modest estimates made in last year's budget - even though part of the shortfall in income taxes and in GST revenues were quietly compensated by growth in excise duties which fall mainly on oil. The FM took no note of this crisis in revenues, and what they reflect about the underlying economy, and omitted to even mention the revenue implications of the tax proposals she announced. Their reality, however, is obvious from the fact that the anticipated revenues for 2026-27 are almost the same as in the Budget estimates for 2025-26 - which in effect means a sharp decline in the proportion of national income received as revenue.

Meeting the objective of reducing the fiscal deficit in such circumstances, in 2025-26 and 2026-27, has to obviously rely on cutting expenditures - and a naked assault on peasants and workers is the way in which this is being achieved. Compared to the Budget Estimates of 2025-26, expenditures have been drastically reduced under several Central and Centrally Sponsored Schemes - like Rasthriya Krishi Vikas Yojana, PM POSHAN, PM-SHRI, PM-JAY, PM-MSY, PMAY (Rural and Urban), Crop Insurance Scheme, etc. Allocations for welfare of Scheduled Castes, Scheduled, Tribes, and North Eastern Areas have also experienced cuts. Also there has been a slashing of expenditures for Agriculture and Allied Activities, Rural Development, Education, Health and Social Welfare. The Gender Budget has been slashed by Rs. 51,144 crores. In the coming year, 2026-27, further cuts are proposed in fertilizer, food and petroleum subsidies. This represents specially an attack on agriculture at a time when government data itself shows that the agriculture sector is facing a deflationary situation or a collapse of price realizations for the output produced.

Even the much touted increase in capital expenditures have fallen victim to the expenditure cuts, with revised estimates for 2025-26 being lower than budgeted. On the other hand, the capital expenditures through resources of public enterprises were lower in 2025-26 than in 2024-25 and are budgeted to remain lower even in 2026-27.

State Governments and their ability to meet the aspirations of their people are also being choked by the Modi Government's approach. The transfers to states under centrally sponsored schemes, finance commission grants, and other transfers has been cut by 2,03,801 crores in 2025-26 as compared to the Budget Estimates. The Budget estimates for 2026-27 shows further a drop of Rs. 59,456 crores compared to 2025-26 Budget Estimates. This is taking place at a time when states are facing a severe financial crunch due to poor GST revenue realizations and the VB-G RAM G has already imposed an effective cut on state's resources by shifting part of the burden of expenditure on to them.

The Finance Minister in her budget speech mentioned that the Modi government's tenure has been marked by 'stability, fiscal discipline, sustained growth, and moderate inflation'. What she failed to mention was that the only stability has been in the distress of the working people marked by rampant unemployment and limited earnings from work, while 'sustained growth' has marked only the incomes and wealth of the rich and the corporate sector. It is this growing inequality that Budget 2026-27 is going to further promote and further aggravate the crisis that is afflicting the Indian economy. It is also a woefully inadequate response to the issues arising from what is happening in the world economy.