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Straight from the Specialists

Keeping fingers crossed in the run-up to Budget 2012

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

It’s interesting that in India, the run-up to the annual Budget means individuals, companies and industry associations keep their fingers crossed in the hope their annual budgets don’t get affected by the announcements of the Finance Minister.

Even the market capitalisation fluctuates several percentage points in the matter of a day based on the pronouncements in the budget. It continues to be an event everyone looks forward to each year and 2012 may be no different.

This will be the eighth finance Budget in a row by the current government, and the past seven have struggled to provide any direction to the economy or to drive it upwards. It’s an admitted fact today that economic growth in India is driven by the private sector, in spite of the government and the policy paralysis that it is so closely identified with now. The opportunity and the need for impetus in policy and government support relating to education, medical facilities, infrastructure, FDI among others is huge, if there is a political will to drive change and growth in these areas. Nonetheless, government policies define the cost of day-to-day life and hence the keen interest.

Union Budget 2012: Need for a concrete plan

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

Like every budget since the subprime crisis of 2008, the one on March 16 will see the Finance Minister walking a tightrope between fiscal consolidation and growth. The only difference being — this time the government is really constrained to provide a fiscal boost to consumption.

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