A budget that aims for post-revival expansion2 min read . Updated: 02 Feb 2022, 06:27 AM IST
It’s consistent with the Centre’s supply-side reform thrust and relies on a mix of public and private spurs to lift our economy’s post-pandemic growth path. Yet, it’s only partly reformist
To the current government’s credit, its embrace of free-market tools for India’s economy has been nuanced, just as its “barbell" response to the covid crisis has been more pragmatic than pre-coloured. Last summer, Prime Minister Narendra Modi sought to contrast a past model of “reforms by stealth and compulsion" with his administration’s “reforms by conviction and incentives." While the clarity of purpose reflected in that contention has had a supply-side focus, reforms have not always been market-oriented, as seen in our import-tariff policy and post-covid emphasis on self- reliance. Nor has it meant a reduction in the state’s overall role, though the pandemic closed this option for at least two years. While national output is expected to recover its covid loss in 2021-22, this recovery clearly needs support for another year. So, a fiscal deficit of 6.4%, as proposed by the budget for 2022-23 unveiled by finance minister Nirmala Sithararaman on Tuesday, is easily justified. Yet, if the deal was for animated private spirits to lead India’s value generation once a spring-back is secured, then this must show in the budget proposals. Does it?