A Budget of missed reform opportunities

It is good to see performance in the economy, and the Economic Survey, as well as the finance minister’s speech, amply make it clear that the macroeconomic fundamentals are excellent and there is expectation of even a higher growth (more than 8.5%) for the next year.

Fiscal consolidation has come to the forefront. We have not heard of SPVs, of borrowings against reserves, and other such ambitious schemes this year, and the results are there for everyone to see.

Budgeted fiscal deficit for the next year is 3.8%, there are no new taxes, and revenue deficit is to be brought down to 2.1%. A cautious Budget, that seeks to consolidate rather than take chances, and expenditure being matched with expected buoyancy in revenues.

There are some concerns. First, plan expenditure at Rs 17,2728 crore, is in fact lower than the arithmetic of the last Budget, where the FM had provided for Rs 14,3791 crore in the Budget and another Rs 29,000 crore to states. Capital expenditure for Plan schemes is targeted at a low Rs 28,966 crore as against Rs 29,638 crore this year and expenditure on revenue account in the Plan is increasing by leaps and bounds. Even allocations for the employment guarantee programme are quite modest.

Next, there is inadequate focus on infrastructure, and, apart from the mega power plants and the back door privatisation of coal mines, ver

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