“The Indian economy is passing through challenging times. The sentiment with regard to the economy is low. The presentation of the Union Budget 2012-13 was a historic opportunity for the Finance Minister to take corrective steps. What were needed were leadership, clarity and cohesiveness in the UPA alliance. All these are lacking. The Finance Minister wasted a historic opportunity, by presenting a non-Budget. His Budget is an accounting statement but not a policy enhancing document. It fails to lift the sentiment of the economy.”
The recent state elections were an evidence of congress’ loosening grip throughout the nation. The chaos within the alliance was public when railway minister declared union railway budget. But somehow in all this politcal fiasco the “aam aadmi” seems to have lost his position. The constant inflation in the wake of global recesion is affecting people from all strata. The Central Government being constantly under attack for Policy Paralysis, Mr. Mukherjee was supposed to work out a miraculous budget to retrieve the confidence in the economy. But some how he seems have failed in this attempt.
India and china grew up as the biggest economic success stories when the world economies including the USA were suffering a huge setback due to gloabal recession. Yet the threat of crony capitalism lurks over our economy. A slew of recent corruption scandals – notably in telecommunications – nourished anxeities about success of economy The corporate political nexus is a big threat to the over all development of country.
The government policies aren’t efficient enough to keep all this in check. It was expected that the budget will design some strict policies in order to check black money and rampant corruption, crony capitalism in the wake of recent huge scams. But all that government has learnt over the yers is to point fingers at precedessors.
Not much has been gained bny the real estate. Moreover increase in the exemption margin of personal income tax from Rs. 1.8lakh to Rs.2 lakh seems nothing better than a joke. Had the margin been increased to Rs. 3lakh it would have been a better step.
No firm decision has been made with regards to FDI in multi-brand retail. Yet another opportunity to boost the Indian economy by ways of significant foreign capital inflows has been terribly missed out.
The Real estate sector’s contribution to the national GDP has significantly declined from 10.6% in FY 2010-11 to 5% this year. The only aspiring ray of hope was the Union Budget 2012-13 which came up as a disappointment.
The best part of the budget is increment in defence budget. The defence sector has received an increment of about 17%. Several defence deals including a mega deal of combat aircraft for the IAF is likely to come up this year. The deals which are likely to be signed this year include 126 Medium Multi Role Combat Aircraft (MMRCA), 145 Ultra Light Howitzers (ULH), 197 Light Utility Helicopters and others weapons and systems for the three services.
Presenting the budget, Mukherjee said that Rs 1, 93,407 crore has been allocated for defence forces of which over Rs 79,500 crore would be earmarked for capital acquisition.
One of the other acheivements of the budget is the large hike given to agricultural sector. The budget proposal to hike the allocation for green revolution in the East from Rs 400 to Rs 1000 crore under the Rashtriya Krishi Vikas Yojana will intensify agriculture researchin the area. It follows the success of last year’s move in which FM provided Rs 400 crore to six states has boosted rice production by an additional seven million tonne.
Overall, the Finance Minister has tried to go the safe way, proposing a modest budget. The policies proposed are on neither of the extremes: Populist or Reformist. The financial reforms that the budget provided aren’t that alluring too. In fact it’s a blow straight on the face of the “aam aadmi”, with whom the congress boasts its hand is.
(A special thanks to Akshay Shah and Yash Kale for their priceless suggestions and honest reviews )