When the BJP-led National Democratic Alliance won the election in May this year, its Prime Minister-elect remarked, Achche din aaagaye to mean, ‘Good days have arrived’. It might have been just political rhetoric. Or to be fair to him, it might well have meant a promise of better days for the common man in an economic and social sense. But in reality, there is no magic wand to trigger a dramatic reversal of fortunes. Indeed the system has so much built-in inertia that any effort at accelerating the pace of change can only be deemed as difficult.
Nothing illustrates this better than the latest Budget presented by Finance Minister Arun Jaitley. There is no dramatic improvement in the target for resource resource mobilisation. Tax revenues are expected to grow by roughly 18 per cent, not much different from the 17 per cent growth achieved in fiscal 2012-13 over the previous year. The country’s manufacturing sector is unlikely to do any better than it did in recent years if projections of trends in excise and customs are anything to go by. They are slated to rise by 10-11 per cent in the current fiscal, way below the 20 per cent growth achieved in 2012-13 over the previous year.
Even subsidies, always a sensitive subject politically, the finance minister has chosen to tread carefully. Fertiliser subsidies, far from showing any reduction, are projected to rise by roughly Rs 5,000 crore (Rs 72,970 cr) over the revised estimates for fiscal 2013-14.
Of course, to be fair to the present finance minister he has had to contend with artificial compression of payments and accelerated accounting for receipts by the previous Government. The Food Security Scheme too gets a provision of Rs 59,000 crore and the overall food subsidy Bill sees a massive 26 per cent jump over the previous year. Any expectation that there would be dramatic overhaul of the subsidy regime in the economy is clearly belied.
The Defence outlay is projected to go up 19 per cent. But the trouble with Defence outlays is that there has always been many a slip between intentions and actual procurement. Ditto with the disinvestment target which is set at an ambitious Rs 43,425 crore. But when you consider the fact that Governments have in the past repeatedly failed to hit disinvestment targets, the jury is out on that.
Government hopes must necessarily rest on greater administrative efficiency leading to an accelerated investments (both internal and external) kick-starting the economy and greater buoyancy in tax collections. The finance minister would then have more money to play with for many of the pet projects of the new Government. But then, that is in the future.