Budgeting for a new vision

"CM Jayalalithaa unveiled Vision Tamil Nadu 2023, a document that lays the roadmap for improving social indices, infrastructure, and income levels of the people within the next 11 years. It envisages Tamil Nadu as India's most prosperous and progressive State with no poverty, where people would enjoy all the basic services of a modern society. "

The Hindu : Opinion / Editorial : Budgeting for a new vision: Tamil Nadu already has in place a strong universal Public Distribution System. With a stronger social safety net, the State might well be on the way towards the stated target of poverty elimination by 2023.

But good planning and efficient budgeting are only the first steps in bringing about the necessary changes in the lives and livelihoods of the people. The toughest part, as always, is from paper and drawing board to field and finished product.

Perils of short-termism

"The infrastructure deficit has been widening year after year and is one of the principal reasons holding back economic growth. Finding money for infrastructure projects, which have long gestation periods, has been an especially challenging task. The Finance Minister has proposed strengthening financial institutions dedicated to infrastructure. The pool of tax free infrastructure bonds for domestic investors is being expanded."

The Hindu : Opinion / Editorial : Perils of short-termism: Less useful and inherently more controversial initiatives have been the relaxations in the rules pertaining to external commercial borrowings (ECBs). The new policy is not the panacea that it is claimed to be. On the contrary, it is a reversal of past policies that sought to restrain such borrowings.

Typically of a short duration, such ECB borrowings carry a huge exchange rate risk, which is magnified by the recent volatility in the foreign exchange markets. A steep increase in short-term external debt is something that needs to be avoided.

The clear message is that short-termism does not pay, not even in the limited context of infrastructure finance.

Budget Blitz

No country is as obsessed with the FM's annual hisaab as India is

Budget Blitz

Jug Suraiya elaborates the period during the budget when the whole of India finds itself hooked to the Finance Minister's accounts. 

-The Times of India, March 23, 2012

A budget at war with the Finance Minister

The Hindu : Opinion / Op-Ed : A budget at war with the Finance Minister: "A huge hike in indirect taxes will cause a fall in both savings and consumption, achieving the opposite of what was intended."

With revenue deficit (4.4 per cent of the GDP) and fiscal deficit (5.9 per cent) hitting the roof, the Finance Minister seems to have turned to chartered accountants for ideas to make his balance sheet appear less inelegant. The result is the innovation of “effective revenue deficit,” which bears the stamp of some multinational accounting firm rather than our conservative civil service.

There are more positive signals in the Finance Minister's speech than in the budget proper. Finance Minister has declared that the government is committed fully to providing for food subsidy even if it cannot afford it. Yet, he has not provided a single penny for the food security project!

A budget for the auto sector

Vinesh Kriplani, a tax partner in Ernst & Young (along with Sonal Jain, senior tax professional with a member firm of the Ernst & Young) explains the potential in the auto sector to boost the economy and why should the government consider providing it the required attention in this years' budget.

"A strong Budget that supports the auto sector at large and brings in clarity on existing anomalies in law will be welcomed by the industry."

Wanted : A budget that plays straight for the auto

Growth engine

The budget for the year 2012 is almost on the cards and India is yearning to see an all inclusive, realistically plausible, and a far-sighted economic perspective with apt imagination and innovation in our plan and balance sheet for this fiscal year.

PM Mathews, a professor of economics in the Christ University explains more...

A fantastic read if one needs to understand the complicated dynamics in economy and the challenges that India face to stabilise it....

Growth is fine, but can Pranab take all on board?

The Railways need funds

"The Kakodkar high-level railway safety review committee, which submitted its recommendations to Railway Minister, may not have said anything new or different from the past but it has chosen to tell the Railways how to mobilise the funds for a long overdue, massive safety upgrade programme over the next five years, with an estimate for Rs.1 lakh crore."

The Hindu : Opinion / Editorial : The Railways need funds: After Nitish Kumar brought the Railways back from the brink, and Lalu Prasad took all the credit for prudent financial management, Mamata Banerjee had virtually brought the Indian Railways to a situation of a financial collapse.

It is time the Planning Commission and Finance Ministry took a serious look at the state of the Railways. For if India's biggest employer is unwilling to take even small steps towards better managing its finances, there is no sense in it having a separate annual budget.

Don't Blow It

The budget is our chance to revive confidence in the economy

Don't Blow It

-The Times of India, February 8, 2012