New Delhi, 10 July-2014(Indilens Web Team): When Arun Jaitley reads out his annual Union Budget today, it could well be the constructive road map the NDA government lays out to bring the “Acchhe din” it has promised the nation.
When Arun Jaitley reads out his annual Union Budget today, it could well be the constructive road map the NDA government lays out to bring the “Acchhe din” it has promised the nation. The state of the economy of India is deplorable though it looks quite solid when compared to many other countries in the world. Jaitley needs to handle taxation issues, social sector schemes, rationalise its subsidies without affecting the poorest, and revive growth in the economy. The expectations from the Budget is huge. Though many of our problems cannot be fixed in a year, this Budget has to lay out the vision of the government for the nation.
The length of the budget speech is often an indication of the state of the economy. Consider UPA-2 speeches by two finance ministers. Pranab Mukherjee started his first budget (2009-10) with high optimism and extensive sops for business and his budget speech was all of 11,700 words. Next year, as inflation worsened and problems started appearing on the horizon, his speech extended to 12,591 words. The year after, as stagflation was visible, his speech length increased to 13,877 words. His swansong budget of 2012-13 stretched to 14,157 words. Luckily, we were spared longer speeches by sending him off to R Bhavan. Chidambaram brought the verbiage down to 12,749 last year (2013-14), and his interim budget, was down to 6,586. The economy is now less worse off than before, but not yet out of the woods.
What will Arun Jaitley do? In his maiden budget, he may want to wax eloquent, but Chidu’s last figure (around 6,000 words) is a good benchmark to follow. The more he yaks, the less he is likely to deliver in terms of his promises. The moral: make fewer but more believable promises.
11:20am : Promoted to minimum government and maximum governance. Govt will form commission to review expenditure. Urea policy will be reformulated.GST essential to restructure taxation. I assure all states govt will be more than fair to all states. Retrospect taxation: No change to be brought in retrospectively. Govt will be extremely cautious.
11:14am: Jaitley says the people below poverty line wants to raise themselves above it. While higher growth is important, we cannot ignore that the poor suffer the most. The government has taken up the challenge in right earnest. The task is challenging because we need to revive manufacturing and infrastructure sector. We need to introduce fiscal prudence. We cannot spend to day which is compensated by tax in future.
Must improve tax-GDP ratio. Although the external sector witnessed turn around and CAD improved, it was through restriction on non-essential imports.
Fiscal Deficit: target 4.1% set by Chidambaram is daunting, but accept the challenge. 3.6% for 2016 and 3% for 2017.
11am: Jaitley starts delivering the budget. Says India unhesitatingly wants to grow. Arun Jaitley start reading out his Budget speech at Lok Sabha. He says people have voted for a change, they decide to grow unhesitatingly.
1055am: The Sensex is back from the red in nervous excitement as Jaitley enters parliament, black box in hand. Any bets where the index will end the day? My guess is in the red. High expectations budgets always tend to disappoint.
10.50am: The cabinet has approved the Union budget, we hear.
Still waiting details of the Budget 2014 by Arun Jetley