There is no dearth of examples of the government according primacy to electoral compulsions over economic rationale and window dressing the sad outcomes to boot. The latest is a first-time proposal for issuing bonds to the fertilizer industry as part of the pending subsidy payout, which, if we extend the oil bond logic, will make the fiscal balance sheet a bit tidier.
How? Because the subsidy bill then won’t show up on the government’s books in full; only the interest cost would. This way, the major part of the liability gets deferred to when the bonds mature—a few years later, when the then powers that be would have to pay up.
Indeed, it’s a case of deja vu when we note how oil bonds have been deployed to help contain the oil marketing companies’ losses incurred thanks to controls on the retail prices of fuel. A populist mindset—fertilizers or fuel—makes the government persist with unviable policies and then downplay the cost to the fisc.