Pratap Bhanu Mehta, writing in an edit page article in the Indian Express of today, gives a very balanced and sage analysis of the budget, and of Modi’s gamble of entering into an alliance with PDP in J&K. This is by far the best write up on the two issues in main stream media.
“This budget does not fully live up to the bold strokes of the Economic Survey. But think of the context. Modi was politically vulnerable. His early silences in the face of communal baiting, the loss in the Delhi elections and the sense of a little drift in government cost him political capital. He had to restore authority to government and not give the Opposition more openings. His speeches on religious toleration helped. But he also needed a budget that, while being reformist, did not give the Opposition a handle. There are things to take issue with in the budget, but it gives little ground for potent political mobilisation in opposition.
There are three charges against the budget. Purists balk at the postponing of fiscal consolidation. But private sector investment is not picking up for a variety of reasons. The extent of the institutional mess this government inherited will take time to reform. The budget was more candid in its depth of understanding of the institutional mess. It was no accident that large sections of the private sector were clamouring for more public investment as a means of making India competitive. The budget is premised on some self-belief in government, that is far more progressive than those who make the silly assumption that you can build competitiveness and markets without the state. It could have invested more in building the state. But the greatest strength of the budget is that it has a range of institutional reforms — from the much-debated monetary policy committee to a new bankruptcy code.” (from the article)
Read the whole article here.
