governance, political economy, institutional development and economic regulation
The first 100 days of the Modi 2.0 government have been marked by lows and highs. Sadly, the lows are longer lasting, while the highs are transient, even in the short term. The biggest low was the Budget for FY 2019-20 in July, which was presented, in the absence of the late Arun Jaitley, with […]
Read More Modi 2.0 100 not out!It’s scarier going downhill than climbing to the top. Whilst on the way up, the heavyweight of inertia is known and hence manageable. Going downhill, inertia accelerates descent in unknown ways. The economy is no different. Flab (public sector banks), poorly maintained brakes (uncompetitive private firms), worn gear cogs (lack of structural reforms) or inadequate […]
Read More Indian Economy – The great slideThe Reserve Bank’s decision to transfer Rs 1.76 trillion to the government as surplus follows the “golden mean” principle, often used by committees. This bonanza comes courtesy an “Expert Committee to Review the Extant Economic Capital” of the RBI, constituted in November 2018, which has now recommended a higher level of transfer as against the […]
Read More RBI plays White Knight to revenue strapped governmentFinance minister Nirmala Sitharaman made history merely by standing up to present the Union Budget on Friday — being India’s first full-time woman FM to do so. True to the forceful style of the BJP, she delivered the speech with zeal and conviction to the loud thumping of desks by the treasury benches with a […]
Read More Nirmala Sitharaman hits all the right buttons for a balanced budgetModi 1.0 was all about learning the ropes of national governance. Budget preparation and execution is a key ingredient. Budget purists cavil that budgets under Modi 1.0 were high on fuzzy motherhood goals and discretionary expenditure but low on schematic, multiplier enhancing allocations. Arun Jaitley’s five years as FM Rhetoric and poetry are part of […]
Read More Budget FY2020 – Marching to a different drum beatIt’s a terrible time to be a minister in the Union government. The economy is tanking under the weight of debt funded public expenditure and low private investment due to the lacklustre consumer demand. Private corporate headline growth is low on the back of low capacity utilisation, which hits government tax revenues adversely and casts […]
Read More Modi 2.0: Time for frugal good governanceRahul Gandhi’s electoral silver bullet to numb the BJP into relative disarray is a mega welfare scheme to transfer Rs 72,000 to each of the 50 million or 20 per cent of the poorest households. It costs Rs 3.6 trillion or 1.8 per cent of GDP. Mine versus yours The motivation is political – to […]
Read More Nyay (Justice) yes! But at what cost?The galvanising energy – one new scheme a week – which characterised the Modi years is ironically, also the cause of an uncertain victory this year. Too many reform steps pancaked Three simultaneous, mega reform initiatives stand out – reducing the fiscal deficit; implementing the Goods and Services Tax and cleaning out bank balance sheets. […]
Read More Triple whammy spoils BJP fiscal end gameGovernments are “lame ducks” in the last quarter preceding a general election. The future might not be theirs and self-assessment of achievements needs independent triangulation. So, caveat emptor prevails on both counts. Nothing, except convention, stops the government from presenting a full budget New taxes and new expenditure are “haram” in a vote on account, […]
Read More Interim Budget 2019 can voice forward looking ideasThe BJP is known for three tactical approaches. First, taking “bold” decisions as per its brand image — witness the swift rollout of the Goods and Services Tax by 2017. Second, it takes risks big time — consider the sudden November 2016 move on demonetisation, which has paid off only partially. Third, it under-informs the […]
Read More Piyush Goyal, opening batsman FY2020