Mr Pranab Mukherjee, did we hear ‘austerity’?
India is going through a rough patch. The common man knows it, foreign investors know it and so does our government.
Finance Minister Pranab Mukherjee, who is also one of the contenders for the post of president, has been trying his best to clear the air and restore the confidence to get the economy back on track.
In his recent Parliament speech, after he delayed the controversial GAAR norms, Mukherjee said new ‘austerity measures’ will be announced to aid the fiscal consolidation process.
The government, however, still doesn’t seem to be frugal when it comes to spending.
On Monday, newspapers in New Delhi were flooded with ads, some of them full page, on the 21st death anniversary of India’s former Prime Minister Rajiv Gandhi. Hindustan Times alone had 11 of them. The Times of India had nine while The Indian Express had eight, all paying tribute to Gandhi.
And it’s a collective effort of various ministries. From the Delhi government to the ministries of power, steel, environment, information & broadcasting, women & child development, commerce & industry — all have space reserved in national dailies to pay tribute in their own way.
Over the weekend, Mamata Banerjee, a key ally of the Congress-led government, had a centre spread in The Times of India as her government completed a year in office. The ad, titled ‘One year towards a ray of hope’ explained the recent initiatives of her state government in West Bengal.
As the economy and markets struggle, India needs tough actions
Slowing growth, a falling rupee, sliding stock markets, a rising current account deficit, drying foreign inflows and policy paralysis at the centre. Things certainly don’t look rosy for India.
With the rupee down 22 percent in the last 10 months and a 6 percent drop in stock markets so far in May (as of Friday’s close), is it time for the government to seriously rethink its strategy ahead of the 2014 general elections?
From Mark Mobius, who said the Indian government has been making many big policy mistakes, to Lakshmi Mittal, who told The Times of India on Friday that decision-making is too slow and India needs to move the way the rest of the world does — there is no dearth of criticism.
As the global economic environment continues to be weak, what is the government doing to address these issues? Right now, India badly needs reforms, foreign inflows, and most importantly, clarity and stability.
It took Finance Minister Pranab Mukherjee nearly two months to clarify his controversial set of General Anti-Avoidance Rule (GAAR) proposals, and also defer it by a year, after an investor backlash.
One wonders what took the government so long to issue clarifications, which could have helped revive much-needed inflows and improve sentiment. And even when it did, it failed to pacify investors.
As a Scotiabank executive summed it up – India changes rules too quickly. They don’t realise it hurts them in debt capital markets and hurts flows on a long-term basis.
Budget 2010: Reactions from the common man
Rohan Dua spoke to people on the streets of New Delhi as Pranab Mukherjee tabled the 2010/11 Budget in parliament –
How to rate the budget?
When the finance minister presents the budget, the stock market moves one way or the other.
And like every year this will dominate the news.
Over there and everywhere.
Is that fair? Or convincing?
Some of the analysis will follow a pattern.
If the stock market goes up, the budget may be described as successful because it didn’t “rock the boat”.
If it moves sideways, it may be said the market had already absorbed the good news — the growth figures for instance.
To rate a budget based on stock market response is totally incorrect. In my opinion stock market is only an indication of how much money people are willing to play with! Now we have phrases like “inclusive” etc, why? When there is no more need for such phrases, that may be a time when stock market can be studied: At that time most of the people may be investing in it. Not now.
When a common man is not having enough moeny for his day to day living, taking stock market as a reference only shows how much of ignorance prevails within the higher class and ruling class of people.
Budget 2010: Time for annual guessing game
It’s a laudable effort that often gets more brickbats than bouquets. This year, when Finance Minister Pranab Mukherjee presents the Union budget in parliament on February 26, he will walking a tightrope between managing ballooning fiscal deficit and supporting economic recovery in Asia’s third-biggest economy.
Expectations from the finance minister, as always, are high — people and corporates want more in their pockets. There has been no let-up in the rise of food prices and most middle-class families still have to wait for annual sales to get branded products home.
In other words, the nation would like to see changes in tax rates, consumables getting cheaper and credit continuing to be available easily.
When the world was teetering on the brink of recession, the UPA government had introduced three stimulus packages of tax cuts, higher spending on public projects and increased liquidity in the financial markets through an easy monetary policy of the Reserve Bank of India. These policy measures helped shore up India’s faltering economy and put it back on a growth path.
The incentives which were passed on to some sectors of the economy are still in place and experts say it is time for a gradual withdrawal.
The Congress-led government has been reassuring people that growth will not be derailed by any decision to withdraw stimulus, but analysts say it is treading a thin line between supporting the economy and inflaming inflation.
The government has pegged GDP (gross domestic product) growth for 2010-11 at 7.2 percent, up from a six-year low last fiscal, and said efforts will be made in the budget to lower fiscal deficit which is at a 16-year high of 6.8 percent of GDP.
feb17’2010
with due respect to the finance ministry & all its members.
1. interest rates r too high in relation to global reality. reduce deficit spending that is driving up interest rates.
2.food prices are a result of energy cost unusual jump during last few years. it is not because of lax financial policy.
3.thru an act of parliament all funding to political parties must be legalised and tax rebateable/ deductable.
4.thru an act of parliament all helping legislations of unnecessary laws encouraging corruption must be done urgently. this will reduce poverty and help growth.
5.gnp growth is the result of all positive actions of governments that hv been in power and such actions must continue. gnp growth would be higher if decifits r reduced and interest rates allowed to reflect international cost of funds.
6.education must be liberalised and morals and values must be the core of the same to help discard the corruption that has been in built since independence due to failure of good value politics by all parties.
7. considering the masses to be stupid is a big mistake dont underestimate thier will and ability to increase growth and bring about changes
chand datwani
Jury still out on Indo-U.S. “unclear” deal
You could be forgiven for thinking that the civilian nuclear deal with the United States is all about whether India holds early elections or not.
Every newspaper is speculating if Prime Minister Manmohan Singh, who has staked his personal reputation on the deal, will resign to disassociate himself from an administration that failed to save a pact keenly watched by the world.
But are these the arguments India should be debating in the short-term or should we be discussing the real benefits and drawbacks of the deal?
The communists oppose the deal, in large part because they see it as a front for Washington’s strategic bulwark against a rising China and increasingly unstable Pakistan.
Besides, they say there are many holes in the deal that Washington will use to manipulate India’s foreign and strategic programmes, and that nuclear energy is not a solution to the shortage of electricity in the country or rising oil prices.
Why? Because nuclear energy can not meet India’s huge oil consumption in the transport sector, is expensive to produce and will expose India to manipulations by a small international cartel of uranium suppliers.
But most Indians feel, if straw polls by newspaper and television channels are to be believed the nuclear deal is good for India: The agreement is meant to provide India with the means to produce clean energy — a key constraint to economic growth. And the rise in crude prices underlines need for diversified sources of energy (even if nuclear will take ages to fill the gap).
I wish to see what will be the face value of this waiver & exemptions if India go to do a Nuclear test TOMORROW or ANYTIME or If India decides to go ahead with LPG pipeline project with Iran. Legacy Of Americans tell us they will lick as long as one being obedient to them otherwise they will suck. Also, I hope Manmohan singh would be alive that time.
As always, Illiterate (Sorry, I meant to say common man is still don”t know what is this deal, they just know their daily life is MISERABLE because of UNAFFORDABLE COST OF LIVING) and comic goons are on the street celebrating beating drums as if they got independence from Americans!!.
Almost 75% of Indians are still living in utter poverty not because our country didn”t have NSG waiver and Nuclear deal. Now we are forced to believe that India remains the poorest because we didn”t have this deal.They people who are going to prosper by this deal are a group of American businessmen,a section of NRIs acting as middlemen and CROOKED POLITICIANS IN INDIA.That will remain as a truth.
If this deal is all about ending acute power crisis in this country, the people all the way praising this deal should wait and see whether this will end the electricity appetite of this nation and how it is going to elevate the poor people of this country. A country with no specific and strict protocols to stop the simple technical faults, transmission leaks and THEFT in electrical transmission systems yet. A country where disaster management,planning & coordination is a myth even in this 21st Century. Still millions are left out homeless in floods every year. who care about them???? I am wondering what this deal is all about!.
“INDIA IS MY COUNTRY AND I AM PROUD OF BEING AN INDIAN” But that words never matched the deeds in this country by its leaders.It is 21st century and India became worst than certain improvished African countries in many aspects if not all.Look at the the utter poverty,
Illiteracy,uncontrolled population growth,rampant corruption,bribery,beurocracy,violence,d irty politics,
Pseudo-secularism,appeasement politics..WHAT NOT THERE.
Unless and until you correct the fundamentals and basic needs of this country It is just a fantasy dream that India become a superpower.For that we need is a realistic approach..visionary leaders..national integrity and patriotism.
Nuclear deal will not fill the stomach of poor people in this country.It is rubbish and foolishness when someone said Nuclear deal will bring down inflation!!!!.What a pity state of affair!
What kind of leaders our people choose and send to parliament, and the people shall have to pay the price for it. What a pity situation of my country!.People are being treated as idiots by their own leaders. This what is Indian democracy!.
Indians will have to wait for many years and luckly if there is a visionary leader with strong political will and nationalistic agenda, then their dreams can be fullfilled. Otherwise the pockets of polticians are only going to be filled with currencies!
“PEOPLE GET WHAT THEY DESERVE”
GOD SAVE THIS COUNTRY.
Is India bending over backwards to please China?
India’s opposition Bharatiya Janata Party has accused the government of a “craven” and “slavish” attitude to China.
The BJP and others argue that the coalition government has failed to prevent repeated Chinese incursions along the disputed border, from Ladakh in the northwest to Arunachal Pradesh in the northeast.
And by trying to muzzle the Dalai Lama and close down Delhi during the Olympic torch relay, it has shown weakness, which will only encourage China to throw its weight around more.
There is also concern about the modernisation of the Chinese army, and the steady improvement of road and rail links in Tibet which are altering the military balance of power. Then there is talk of fresh Chinese claims to the northern tip of Sikkim.
“Given the growing perception that the UPA government lacks resolve… it is no surprise that Beijing has put the historically undisputed border with Sikkim back into contestation,” the Indian Express wrote in an editorial. Bharat Bhushan in the Mail Today said India had bent over backwards to China without any apparent dividend, while Brahma Chellaney argues China is trying to tie India down in the Himalayas “in order to avert the rise of a peer rival in Asia”.
But does India have any choice but quiet diplomacy? Should India swallow its pride and keep China happy over the Tibet question, even put up with a bit of border wrangling, and concentrate on the bigger picture?
Trade ties are booming and India stands to gain from a closer relationship with China, after all.
As far as the trade is concerned i personally feel that China will continue its relation the way it is now. When it comes to the border issue the Indian Govt should not step back. This can be solved with diplomats having more talks with the Chinese Govt regarding the border issue.Making the Chinese understand that we are not very pleased with the incursion in the East of Ladakh regions and the demand of areas in Arunachal Pradesh should serve the purpose.
Average Indian practices Austerity….tht is how we have been brought up…….It is the Politicians who lack any accountability lack Austerity……….