Controlled hand-outs: Fiscal discipline maintained in an election year

It is hard to argue against hand-outs to the distressed, but one must not lose sight of the fact that the fiscal space for the hand-outs has been created partly by squeezing existing scheme' funding

As pre-election Budgets go, Piyush Goyal’s isn’t too bad. While vote-oriented announcements cost about Rs 1 trillion (or about half of 1 per cent of next year’s GDP), the fiscal deficit will remain unchanged from this year’s revised figure of 3.4 per cent of GDP. A pause in fiscal correction is tolerable, whereas a reversal of direction would have been a much more negative development. It could well have been a reversal, if any of the hairier schemes for a basic minimum income had been announced. Still, the deficit could climb for the current year if the somewhat ambitious Revised