A Feel-good Budget

But there is nothing in it to boost agricultural output.

The feel-good factor across India on Friday underscores the finance minister, Mr Pranab Mukherjee’s, largesse to the country's burgeoning middle class, with whom he has been more than generous. Microwave ovens, prepackaged imported goods, mobile phones, toy balloons... all these will now be cheaper. With the tax concessions and change in slabs, Mr Mukherjee has forsaken Rs 26,000 crores in direct tax revenue, but he has also gained Rs 46,500 crores through increased indirect taxes. Unfortunately, though, these indirect taxes have a bigger impact on the aam aadmi and the poor. Mr Mukherjee did nothing to upset any section of society, but he did not do enough to push agricultural production or indicate what the Centre proposed to do to tackle food inflation. Today, for instance, there are 25 commodities which can be given a minimum support price, but only four or five get it. If there was procurement for pulses and oilseeds, which are in tremendous short supply, it would have been more meaningful. Mr Mukherjee must be congratulated for two important announcements. One was on bringing in administrative reforms, which he acknowledged had been pending for long, and which is a systemic structural and institutional weaknesses in government which causes bottlenecks in the public delivery mechanism. The second major announcement was recognition of climate change, for which he provided some tax concessions.

Individual taxpayers will be a happy lot as there will be only two forms to fill. Even more exciting is the ‘Justice To All National Mission’ which promises to reduce the backlog in the courts from 15 years to three. In the past too, we have had several missions: some were successful, such as the one on telecom; while others, such as the one on pulses, were not. The finance minister has been specific about identifying 60,000 oilseed villages in rain-fed areas, but he will need to have a mechanism to conduct an audit of progress on all his announcements, and fix responsibility — rewarding those who do their job and achieve targets, and punishing those who do not. This will ensure his government’s intentions get translated into reality. He quoted the great sage Kautilya to describe what he intended to do in his Budget. Perhaps Kautilya will not be disappointed, and like the stock market which gave him a 335-point salute, Kautilya too will give Pranab Babu a pat on his back.

Deccan Chronicle, 27 February