SA Pragmatic Budget

Budget 2007, a keenly awaited event is now over, and has revealed the mood of the people. The initial reaction of the man on the street betrayed a sense of unease, and a confused mind. The FM seems to have devoted little attention to the fast growing segments of the economy such as IT and auto industry, and put his money on agriculture; education and health care.

With the economy showing strong growth and other economic parameters in a comfortable zone, it was just the right time to give a boost to the more neglected areas of the economy. Inflation is surely a cause of concern, but with adequate steps taken, the finance minister has looked far beyond. Agriculture products mainly wheat, pulses and other common man's items have been in short supply leading to sharp rise in prices. The Budget envisages a series of steps to improve the supply of essential commodities. Budgetary provision for education has been stepped up, with the lower end getting better opportunities. Health care to far fledged areas is set to improve, with plans for setting up more local dispensaries.

Allocations are fine, but the buck now passes on to the respective ministries. The best thought about plans are not even worth the paper they are written on, if not backed up by proper, foolproof and a fast delivery system. This is all the more critical, since the bulk of the beneficiaries are the uneducated poor.

To add to the vagaries of the budget, it comes at a time when the country's largest state is set to go to the polls. Any honest interpretation of the budgetary exercise has to take into account the political compulsions involved.

The government seems to have taken for granted that its revenues would continue to be robust against the backdrop of a smart growth in the economy. The FM has presented an off the course budget, but it will take a corporate like governance to implement it. On the flip side, the corporate sector is none too happy with Chidambaram's prescriptions. Be that as it may, the IT industry and manufacturing sector should stand to gain from the resurgence in education in the rural areas, acting complementary to the needs of the modern economic sectors. Summing up, the Chidambaram-Manmohan Singh combine have managed to do a skilful balancing act, given the pulls and pressures of an electoral year.