Budget- 2009

I don’t know how interesting this topic would be, but I thought it’s not necessary that we always discuss interesting topics, at times we should look at topics that are important rather than being interesting.

It was budget (interim) day today and not sure how many of us followed it. I am not going to paste the budget here as we can get the details from any of the websites instead I am trying to interpret the Good, Bad and Ugly aspects of this budget.

If I have to sum up the budget in one line then I would say that this budget is more of talk and less of action. This was anticipated anyways as this was an election year budget ad also an interim budget and not a final one, but the only disappointed that I have is that they should have done something more for the ‘aam aadmi’ the very base of the party in power.

They have allocated money to the rural sector which is good but the drawback is that all these have been done keeping in mind the election and not the core issue of helping these people. Also the government has increased the budgetary expense for NREGA Plan the flagship program for UPA but the problem is that all of us know how poor the implementation of these programs are.

The government has planned to start few new IIMS and IIT which is good and also the budget for mid day meal has also been increased. The easiest way to have inclusive growth in our country is to increase the outlay in education for 10 consecutive years and see the transformation that it brings.

Seeing the economic climate the government could have come up with new ways of increasing employment which would have helped in sustaining the GDP growth but instead the government has left everything for the new office bearer. There could have been a relief package (on lines of something prepared by Obama Administration) and tha would have fuelled growth and employment.

Hiking defense budget by 35% is the best thing in this budget, I just hope that this money is used as in the past years the MOD has not spent the money allocated to it, the reason being that no one is ready to sanction new defense equipments because they feel that it will haunt them when they are out of power.

One starking fact is the Fiscal deficit which has reached 6%, the next government will have a tricky situation to follow as it has to come up with some out of the box solution to bring down the fiscal deficit else it will directly effect all of us because if fiscal deficit is high then it will effect the bond yield and also RBI will not be able to decrease the interest rate and if all these happen then it will draw all of us in the vicious cycle of inflation, recession etc.

I just hope that the next few months pass on without a major hiccup and the next government that comes to office looks that the plight of ‘aam and so aam aadmi’ and comes up with a budget that helps us come out of these difficult times.