In a few minutes from now, Finance Minister Pranab Mukherjee will present what is one of the biggest challenges of his long political career – the Union Budget 2012. The Union Budget is usually about economics. Today, it is more about politics.
He arrived in Parliament early, carrying his big brown suitcase and wearing a smile. All economic indicators are crying for a “tough budget” from the Finance Minister. On Thursday, the economic survey tabled in Parliament and the credit policy announcement of the Reserve Bank of India together called in one voice for “fiscal consolidation”. Which is equal to a tough budget. Such a budget should have more tax receipts, more disinvestment, more reforms, less dole-outs through subsidies and less expenditure.
Coalition politics of the fragile nature that the UPA government has on its hands now demands exactly the opposite – doles, freebies, populist measures, no reforms.
Experts of all hue have called on the finance minister to act in the interest of the nation. Dinesh Trivedi, the railway minister, is on the verge of losing his job for having done that – he raised train fares after nine years, a bold move hailed universally, and now his own party the Trinamool Congress wants him axed. Today, insists Mamata Banerjee.
Pressure from allies like Ms Banerjee pushed the UPA government into what is seen as a “policy paralysis” all through last year. Reform measures were announced only to be stalled by a red-faced government after much arm-twisting by those allies whose support ensured that the government survived. Investment sentiment is at an all-time low and industry is clear that is looking to the finance minister for a pro-growth Budget.
Anand Mahindra of theMahindra group tweeted on Friday morning, “Slashing of the EPF rate a bold,rational&courageous step. Hope we will be able to use the same adjectives for his budget this morning. (sic)”
Can Pranab Mukherjee bite the bullet?
By keeping interest rates untouched, the Reserve Bank of India is looking for a cue from the finance minister for fiscal consolidation. India needs a tighter fiscal policy to let RBI cut key interest rates to boost growth. This means the government tightens its expenditure and allows RBI to release money to fuel economic growth.
Up to January 2012, the accumulated fiscal deficit reached Rs 4.35 lakh crore, which is 105.4% of the estimated amount last year. The fiscal deficit could in the range of 5.5-6 per cent of the GDP.
Businesses and markets are not looking for numbers. They are looking for a statement of intent. They are looking for Manmohan Singh and Pranab Mukherjee to show character and do what it takes to bring back the economy on the much needed 8.5 per cent to 9 per cent growth trajectory. They want the government to present a roadmap to seize control of rising subsidies bill that is likely to
They hope that he will speak about decontrol of fuel prices, tax reforms.
In that context, it matters what Pranab Mukherjee says on the roadmap towards a single goods and services tax or GST roadmap. A single such tax across the country makes it easier for goods and services to move efficiently across states.
Businesses are also aware that tax rates are set to rise.
While automakers are bracing for a tax on diesel cars, those in the consumer goods space expect excise duty rates to go up.
The minister is likely to bring back excise duty to the pre-2008 economic crisis level of 12 per cent from 10 per cent for cement, consumer goods and cigarettes.
But nobody wants the government to raise taxes and not show an intent to reform or cut expenditure.
The big brown briefcase has reached Parliament. In it Pranab Mukherjee carries what is one of the biggest challenges of his long political career – the Union Budget 2012. The Union Budget is usually about economics. Today, it is more about politics.
All economic indicators are crying for a “tough budget” from the Finance Minister. On Thursday, the economic survey tabled in Parliament and the credit policy announcement of the Reserve Bank of India together called in one voice for “fiscal consolidation”. Which is equal to a tough budget. Such a budget should have more tax receipts, more disinvestment, more reforms, less dole-outs through subsidies and less expenditure.
Coalition politics of the fragile nature that the UPA government has on its hands now demands exactly the opposite – doles, freebies, populist measures, no reforms.
Experts of all hue have called on the finance minister to act in the interest of the nation. Dinesh Trivedi, the railway minister, is on the verge of losing his job for having done that – he raised train fares after nine years, a bold move hailed universally, and now his own party the Trinamool Congress wants him axed. Today, insists Mamata Banerjee.
Coalition politics of the fragile nature that the UPA government has on its hands now demands exactly the opposite – doles, freebies, populist measures, no reforms.
Experts of all hue have called on the finance minister to act in the interest of the nation. Dinesh Trivedi, the railway minister, is on the verge of losing his job for having done that – he raised train fares and now his own party the Trinamool Congress wants him axed.
Can Pranab Mukherjee bite the bullet?
By keeping interest rates untouched, the Reserve Bank of India is looking for a cue from the finance minister for fiscal consolidation. India needs a tighter fiscal policy to let RBI cut key interest rates to boost growth. This means the government tightens its expenditure and allows RBI to release money to fuel economic growth.
Up to January 2012, the accumulated fiscal deficit reached Rs 4.35 lakh crore, which is 105.4% of the estimated amount last year. The fiscal deficit could in the range of 5.5-6 per cent of the GDP.
Businesses and markets are not looking for numbers. They are looking for a statement of intent. They are looking for Manmohan Singh and Pranab Mukherjee to show character and do what it takes to bring back the economy on the much needed 8.5 per cent to 9 per cent growth trajectory. They want the government to present a roadmap to seize control of rising subsidies bill that is likely to
They hope that he will speak about decontrol of fuel prices, tax reforms.
In that context, it matters what Pranab Mukherjee says on the roadmap towards a single goods and services tax or GST roadmap. A single such tax across the country makes it easier for goods and services to move efficiently across states.
Businesses are also aware that tax rates are set to rise.
While automakers are bracing for a tax on diesel cars, those in the consumer goods space expect excise duty rates to go up.
The minister is likely to bring back excise duty to the pre-2008 economic crisis level of 12 per cent from 10 per cent for cement, consumer goods and cigarettes.
But nobody wants the government to raise taxes and not show an intent to reform or cut expenditure.
He arrived in Parliament early, carrying his big brown suitcase and wearing a smile. All economic indicators are crying for a “tough budget” from the Finance Minister. On Thursday, the economic survey tabled in Parliament and the credit policy announcement of the Reserve Bank of India together called in one voice for “fiscal consolidation”. Which is equal to a tough budget. Such a budget should have more tax receipts, more disinvestment, more reforms, less dole-outs through subsidies and less expenditure.
Coalition politics of the fragile nature that the UPA government has on its hands now demands exactly the opposite – doles, freebies, populist measures, no reforms.
Experts of all hue have called on the finance minister to act in the interest of the nation. Dinesh Trivedi, the railway minister, is on the verge of losing his job for having done that – he raised train fares after nine years, a bold move hailed universally, and now his own party the Trinamool Congress wants him axed. Today, insists Mamata Banerjee.
Pressure from allies like Ms Banerjee pushed the UPA government into what is seen as a “policy paralysis” all through last year. Reform measures were announced only to be stalled by a red-faced government after much arm-twisting by those allies whose support ensured that the government survived. Investment sentiment is at an all-time low and industry is clear that is looking to the finance minister for a pro-growth Budget.
Anand Mahindra of theMahindra group tweeted on Friday morning, “Slashing of the EPF rate a bold,rational&courageous step. Hope we will be able to use the same adjectives for his budget this morning. (sic)”
Can Pranab Mukherjee bite the bullet?
By keeping interest rates untouched, the Reserve Bank of India is looking for a cue from the finance minister for fiscal consolidation. India needs a tighter fiscal policy to let RBI cut key interest rates to boost growth. This means the government tightens its expenditure and allows RBI to release money to fuel economic growth.
Up to January 2012, the accumulated fiscal deficit reached Rs 4.35 lakh crore, which is 105.4% of the estimated amount last year. The fiscal deficit could in the range of 5.5-6 per cent of the GDP.
Businesses and markets are not looking for numbers. They are looking for a statement of intent. They are looking for Manmohan Singh and Pranab Mukherjee to show character and do what it takes to bring back the economy on the much needed 8.5 per cent to 9 per cent growth trajectory. They want the government to present a roadmap to seize control of rising subsidies bill that is likely to
They hope that he will speak about decontrol of fuel prices, tax reforms.
In that context, it matters what Pranab Mukherjee says on the roadmap towards a single goods and services tax or GST roadmap. A single such tax across the country makes it easier for goods and services to move efficiently across states.
Businesses are also aware that tax rates are set to rise.
While automakers are bracing for a tax on diesel cars, those in the consumer goods space expect excise duty rates to go up.
The minister is likely to bring back excise duty to the pre-2008 economic crisis level of 12 per cent from 10 per cent for cement, consumer goods and cigarettes.
But nobody wants the government to raise taxes and not show an intent to reform or cut expenditure.
The big brown briefcase has reached Parliament. In it Pranab Mukherjee carries what is one of the biggest challenges of his long political career – the Union Budget 2012. The Union Budget is usually about economics. Today, it is more about politics.
All economic indicators are crying for a “tough budget” from the Finance Minister. On Thursday, the economic survey tabled in Parliament and the credit policy announcement of the Reserve Bank of India together called in one voice for “fiscal consolidation”. Which is equal to a tough budget. Such a budget should have more tax receipts, more disinvestment, more reforms, less dole-outs through subsidies and less expenditure.
Coalition politics of the fragile nature that the UPA government has on its hands now demands exactly the opposite – doles, freebies, populist measures, no reforms.
Experts of all hue have called on the finance minister to act in the interest of the nation. Dinesh Trivedi, the railway minister, is on the verge of losing his job for having done that – he raised train fares after nine years, a bold move hailed universally, and now his own party the Trinamool Congress wants him axed. Today, insists Mamata Banerjee.
Coalition politics of the fragile nature that the UPA government has on its hands now demands exactly the opposite – doles, freebies, populist measures, no reforms.
Experts of all hue have called on the finance minister to act in the interest of the nation. Dinesh Trivedi, the railway minister, is on the verge of losing his job for having done that – he raised train fares and now his own party the Trinamool Congress wants him axed.
Can Pranab Mukherjee bite the bullet?
By keeping interest rates untouched, the Reserve Bank of India is looking for a cue from the finance minister for fiscal consolidation. India needs a tighter fiscal policy to let RBI cut key interest rates to boost growth. This means the government tightens its expenditure and allows RBI to release money to fuel economic growth.
Up to January 2012, the accumulated fiscal deficit reached Rs 4.35 lakh crore, which is 105.4% of the estimated amount last year. The fiscal deficit could in the range of 5.5-6 per cent of the GDP.
Businesses and markets are not looking for numbers. They are looking for a statement of intent. They are looking for Manmohan Singh and Pranab Mukherjee to show character and do what it takes to bring back the economy on the much needed 8.5 per cent to 9 per cent growth trajectory. They want the government to present a roadmap to seize control of rising subsidies bill that is likely to
They hope that he will speak about decontrol of fuel prices, tax reforms.
In that context, it matters what Pranab Mukherjee says on the roadmap towards a single goods and services tax or GST roadmap. A single such tax across the country makes it easier for goods and services to move efficiently across states.
Businesses are also aware that tax rates are set to rise.
While automakers are bracing for a tax on diesel cars, those in the consumer goods space expect excise duty rates to go up.
The minister is likely to bring back excise duty to the pre-2008 economic crisis level of 12 per cent from 10 per cent for cement, consumer goods and cigarettes.
But nobody wants the government to raise taxes and not show an intent to reform or cut expenditure.
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