This year, many of us believed our talented Finance Minister P. Chidambaram had the ideal platform. Tax collection had doubled in three years, the fiscal deficit and the revenue deficit had been reduced, and the economy was growing at an unprecedented 9.2 per cent. This was the right time for Chidambaram to deliver the Budget that would send India's economic growth on a higher trajectory. This was the Budget, that, like Manmohan Singh's in 1991, would seal Chidambaram's place in India's history. Time for our Big Leap Forward.
Our March 2005 cover
Sadly, that did not happen. What we got instead-big bucks but no bang. Rather than control inflation and promote growth, a large amount of funds have been allocated towards social sectors like health, education and agriculture. Undoubtedly, spending on social sectors is an urgent need but in Indian politics the ritual very often overshadows the result. Crores are poured into social sector spends but we never know whether any of it yields any tangible benefits or results.
Surprisingly, this from the same finance minister who cautioned in his 2005 Budget speech that "outlays don't necessarily mean outcomes". Exactly. Then why this emphasis without putting a monitoring mechanism in place? Perhaps, the answer lies in the fact that Chidambaram's 30-page Budget speech was devoted to these areas, making it sound more like an election manifesto than a Budget speech. Throwing money at the problem is not the solution. How can anyone, least of all a Congressman, forget Rajiv Gandhi's statement that of every rupee allocated for development, only 15 paise reached those it was meant for. For all the budgetary allocation on primary education, India still has amongst the lowest literacy rates in this part of the world. This Budget once again caters to the slogan of inclusive growth but fails to address the core issue of how the inclusion will take place.
Our cover story this week is an indepth analysis of the Budget which includes the incisive views of the Board of India Today Economists (bite), which concludes that this is a bits and pieces Budget without any big ideas.
There were great hopes from India's economic Dream Team of Prime Minister Manmohan Singh, Finance Minister Chidambaram and Montek Singh Ahluwalia, deputy chairman of the Planning Commission.
They were expected to deliver an audacious Budget to propel the economy to new heights. Instead, we got one hemmed in by politics, hamstrung by political defeats or the prospect of it and stymied by its own internal contradictions. India's growth rate, admired and envied all over the world today, deserves to be fuelled not just by money but by more imagination, bigger ideas and a grander vision.