THE BUDGET in India mostly address short-term marginal issues and are statements of income and expenditure that often touch the issues of expansion and liberalization of the private sector in the context of globalization. They seldom focus on basic long-run issues with any seriousness; the fiscal and monetary matters and the whole gamut of economic issues remain untouched.
In order to be effective, the budget, has to be an important link between the past and the future, and must, therefore, address, apart from income and expenditure, the long-run objectives and issues of economic and social importance. Neglect of basic issues will increasingly show up in disappointments even in the short-run. Long-run ‘demand-side’ issues like high inflation or unsustainable current account or fiscal deficits, and imbalances in the balance of payments work against macro-economic stability and the ethos of growth and development in a serious way. Likewise, long-run ‘supply-side’ issues linked with trade and capital flows, financial sectors, industrial deregulation, Direct & Indirect Taxes and disinvestments of public sector enterprises, have their own importance.
More on: Union Budget 2009-2010
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