The budget seems to be a prudent mix of politics and economics, said economist Dilip Panda.
The major problem for the Finance Minister while presenting the annual budget was to curtail the twin deficits __ fiscal and current account __ to fight high inflation, low growth rate and raise the momentum of savings and investment, Panda said, adding that although the Finance Minister has tried to harp on each of these macro economic parameters, it is the end result that will prove his success or failure.
Summarising the budget, Panda said overall, the Finance Minister has tried to present a balanced budget to suit almost all classes of society.
Pointing out that the thrust is on raising the present growth rate from 5.5 per cent to 6.5-6.8 per cent in the next fiscal, Panda said the Finance Minister has tried to ease credit flow and credit facilities to the investors and simultaneously raise the savings of the household sectors. “His aim to reduce the fiscal deficit from 5.2 per cent to 4.8 per cent seems to be unrealistic, since the growth in revenue through taxation is minimal. However, the target of the Finance Minister on disinvestment of `55,800 crore is considerably high and difficult to be realised,” he said.
Looking at the expenditure side, diversion of a large amount towards rural development, agriculture credit and social welfare schemes in relation to meagre increase in revenues may not be able to reduce the fiscal deficit and add up to the inflationary spiral in the economy, he observed.
Former MP Bhabani Hota termed the budget as ‘uninspiring’.
“It is an election-oriented budget targeting the specific social groups, states and certain areas of the states to consolidate the vote bank and also to expand the vote bank among these sections of the population,” he said.