Budget lacks fiscal discipline
The gross fiscal deficit is budgeted to reach 5.6 per cent of the gross domestic product in 1998-99.
Given that most Budget proposals are optimistic and the current one does not show any signs of being different, the likelihood of the deficit turning out
to be much higher is distinct, warns the Centre for Monitoring Indian Economy.
Insurance unions opposed to a role for private sector
Six trade union have decided to agitate against the government's decision. They claimed that the new move for providing
better insurance cover and mobilising resources for infrastructural development sounded "hollow and meaningless."
'Budget is growth-oriented'
'It shows a very balanced approach, and is very pragmatic
compared to last year's dream Budget,' says Dr S P Gupta, chairman, Society for Economic and Social Transition.
'No special policy package to revive capital market'
'The Budget is pro-farmer and pro-rural -- the allocation for
agriculture, irrigation, water supply, and housing received a big boost,'' says Dr U Shankar, director, Madras School of Economics.
'The Budget is pedestrian and lacklustre'
'It cannot help revive the economy nor can it impart any buoyancy to the stock markets,' said former Union minister N K P Salve. 'I must concede that it is easier to sell
socialism at the hustings than making a free market economy acceptable in a
'In one sentence, it is an absurd Budget'
'It does not say a thing about which direction he wants the economy to move. There is no reference to actual or postulated rates of saving or capital formation, or to any projections with growth in agriculture and industry.' says former West Bengal finance minister Ashok Mitra.
'The Budget is inflationary and will hit the poor sections'
Prof Madhu Dandavate, former finance minister, says the effect of sanctions were not taken note of and says that whether sanctions will come in or not depends upon how India conducts itself.
'This disappointing Budget ignores India's changed economic environment after the nuclear explosions'
'The finance minister should have shown leadership and imagination and
should have introduced measures to suggest that we are prepared to face
the new world,' says Dr Arjun Sengupta.
'The Budget is probably going to be a fiscal disaster'
Economist Ajay Shah points out that there is too much spending in the Budget, with projections based on a 14 per cent nominal growth in GDP. That is hard to obtain in the best of times, needing 6.5 per cent inflation and 7.5 per cent GDP growth.
Increased defence and sanctions can cost up to Rs 100 billion'
Economist S S Bhandare, in an exclusive interview, also points out that if the government decides to slash cut its employees like China is doing, there will be a revolution.
'In a globalised economy, we do not have the freedom to choose our own tax structure'
'China has a low income tax rate... If you have a 50 per cent income tax rate and China 30 per cent, people will prefer the latter,' argues Madras School of Economics Director, Dr U Shankar, urging the government to take long-term measures to attract foreign investment. ''India needs a lot of money for infrastructure... We can modernise India in just four or five years if you have good communication facilities.''
Put economy back on 7 to 8 per cent growth path: Economic Survey
The Economic Survey for 1997-98 calls for fresh initiatives to do away with the "inspector raj" and to necessitate raising of savings rate to about 30 per cent of the GDP. It also seeks an improvement in the infrastructure areas like energy, transport and communications.
Food subsidy may be hiked marginally
The Interim Budget did not increase the food subsidy, maintaining it at the revised Rs 75 billion level.
PM's five-point plan to accelerate growth
The highlights of the plan are: top priority for the science and technology sector with special emphasis on software development; emphasis on doubling farm production within the next decade; higher priorities for health care, drinking water, education and sanitation; higher allocations for infrastructural development including roads, ports, airports, power and telecom sectors, and equitable distribution of water resources.
Govt told not to use PSU disinvestment to meet budgetary deficit
The disinvestment process in the public sector undertakings should be delinked from the budgetary process in case the stock is sold through the capital markets, said the department of public enterprises.
CII's 15-point plan targets 7 per cent growth
The present growth rate is less than five per cent, according to a study conducted by the Central Statistical Organisation.
Budget may focus on savings, spare tax structure
In the area of direct taxes, it is expected that the government
may retain the existing rates. The BJP-led coalition's national agenda for governance has laid stress on stepping up savings.
The Budget is, therefore, likely to provide incentives for savings.
It is likely that the Budget may come out with fresh initiative in the housing and construction sector which has great potential for generating demand in a large number of industries while creating largescale employment.