India's bad budget

Many economists/ media persons have tried to make the best out of Mr Pranab Mukherjee's budget. Unfortunately, their arguments are weak and unconvincing . Here is a government which had an opportunity to break free from the left. As we all know, the Left had consistently been stonewalling the reform initiatives for the past few years. Yet by sending out such confusing signals, the Congress has made it abundantly clear that the left was ( as Percy Mistry recently put it) " a convenient fig leaf for obscuring the inconvenient truth". The real opposition to reforms lies within the Congress. The party remains as socialist as ever. The way Mukherjee sang praises about Indira Gandhi's nationalisation of the banking system in the 1960s is a case in point.

Once we separate out the rhetoric from the substance, we see that the key messages from the finance minister/government are :

A) We will continue to waste the exchequer's money.

B) We know more than the markets.

C) We will continue to micromanage and meddle in the economy.

D) Accelerating the reforms process ( thereby encouraging entrepeneurship) is not a priority for us.

E) We can make any statements we like without substantiating data and get away with it.

F) Public memory is short and any commitments we make ( on fiscal discipline) can be conveniently overlooked at a later date.