Govt in a hurry to do things right

The Economic Survey 2008-09 begins starkly by saying that growth has decelerated to 6.7 per cent in 2008-09 — a decline of 2.1 per cent from the average growth of the preceding five years. But, “The five years of high growth has [sic] raised the expectations of the people. Few remember that during the preceding five-year period from 1998-99 to 2002-03 average growth was only 5.4 per cent, while the highest growth rate achieved during the period was 6.7 per cent (in 1998-99).” The list of recommendations to sustain the growth momentum thereafter reads like one prepared by a child planning a party to match and even surpass a previous momentous one. There is such a great sense of urgency and commitment that it is difficult to pour water on the enthusiasm and ask any questions. This is a government that is happy to be back in power with a free hand and is in a hurry to get things right. In fact, the lists of recommendations are so comprehensive, they will keep columnists from criticising government intentions fora while. As to the implementation, we will have to wait and see. Yet, if the fuel price hike going through with such little discussion is any indication, there is considerable hope for the future.

So we can now look forward to going back to the FRBM target in 2010-11, removal of pesky taxes like FBT, disinvestment raising Rs 25,000 crore annually, revamp of old laws, higher transparency in PDS, a change in the nature of subsidies from being producer to consumer targeted, removal of price controls on fuel, on drugs, reform in the education sector that allows for outcome oriented review, removal of forward trading bans, delinking telecom licenses from spectrum allocation, allowing spectrum to be auctioned and tradeable, private trains for tourist destinations, a new bankruptcy law, opening up of FDI in retail and integrating the chains with wholesale outlets where local kirana shops can source items etc. etc. etc……and even a National Waste Mission with “a national sewerage grid and a national solid waste collection and disposal system to complement a national clean water grid”….what more could we want?

Here’s to a brighter future – now if they could also get the monsoon to behave, that would be the cherry on the cake.

The author is chief economist, Indicus Research