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Oh my GOLD CAD and the emergency thereof An eventful week with VVIPs of Delhi Star of the South You too T M Krishna? How will it PAN OUT Babes In the wood-RBI North block has little clue to curb inflation Jobs - Lost, Changed or Gained Need for radical RBI reform INDIA keeps its date with destiny Cleansing Indian retail A Fine division of responsibilities What the big B should offer? Economy through the month 1800 parties registered with EC – Less than 60 contest elections A historic indirect tax reform Strategic planning the missing link Better relations with UK... When the examiner cheated... Breaking news or breaking credibility? Pool energy prices Wanted: decentralised financial system Reform this licence to…kill Weaving wealth of western Tamil Nadu TN - so much to offer... Sustainably developing manufacturing sector… Sardar Sarovar – the seventy year itch Why throw baby with bath water? A tale of two Bihar babus Land, land everywhere, but... Industry can’t get it from Mars, yet Sowing seeds of hope Ganesh’s mantras Deming awardees galore! Truce at Kasturi Buildings Policy Makers CSR, tech revolution and bank crisis Research for survival... Much ado about nothing Healthy finances of the Chennai Corporation Kudos to GIM organisers... Well-administered State South India’s 100 most valuable companies A gratifying record PC please be our Santa A blueprint for the future Outward ho Welcome rains for damaged roads... No groundnuts in groundnut oil! MS Installed In the horns of a dilemma Focus on southern TN... Miles to go... They add lustre to Padma Awards BJP can now hasten its thrust for reforms Tryst with GST The deluge and the several kindly souls Why (not) abolish? Tax evaders’ get out of Jail-Free Card It’s raining funds for states. Really? If not Tamil Nadu, where else? Skewed Economic Zones? Make way for Make in India... Focus on agriculture and human resources Babes In the wood-RBI North block has little clue to curb inflation Little surplus after salaries, subsidies and debt servicing The Great Fall Need plan over the long term planning After all, customer is the king Technology and economic development should be linked Indian GST – Between extremes… Public investments and welfare will surge Trail-blazing Tamil Nadu Much can be done by us Low profile moves Rail-road Rajaraman A dual GST that will protect prosperous states Welcome move to widen the tax net… Chennai Airport-Ready for a rapid take off... Two welcome measures from the chief minister... An eco-friendly commute in Mysuru Welcome Measures. Work for 10X Change
 
What the big B should offer?
The Indian economy is at the crossroads. It is awaiting tough fiscal policy response from the finance minister, which would be painful in the short-term, but would invoke the confidence of all stakeholders in the future of Indian economy.
FINANCE MINISTER CHIDAMBARAM is being overwhelmed with multiple challenges as he gets ready to formulate Budget 2013-14 – reviving growth, containing inflation, reducing trade gap and current account deficit, removing stumbling blocks in infrastructure development, rejuvenating investment outlook, targeting poverty reduction, covering deficits in social sector performance, strengthening financial sector and what not. To cap it all there is a threat of downgrading from the international credit rating agencies.   

Of course, such challenges tend to become ritualistic in nature, especially there have been when two or three crucial years of policy paralysis; and also in the wake of persistent hostile global economic environment. Perhaps never before was there such a constellation of formidable issues.

Effectively, Budget 2013-14 happens to be the chance for the UPA II government before the next general election in early 2014. It has an uphill task to prove its commitment to the implementation of pending reforms agenda; revitalise ‘animal spirit’ of investors; and ‘go for growth.’ Or in the usual quest for populism around this time, there would be the temptation to indulge in aggressive ‘social-welfare’ spending. In the long run such a strategy would be unsustainable and there would not be any political dividend to reap.

On the contrary, it is high time for the UPA II government to unveil its political maturity and sagacity through bold policy reforms. It is time to bite the bullet and administer the needed ‘bitter medicine.’ That’s the only way to restore the confidence of stakeholders in the future of our economy. 

Here’s my wish list.

First, putting the fiscal house in order. There can be no further fiscal drift. The likely revised estimate of fiscal deficit to GDP ratio of 5.5 per cent in 2012-13 needs to be reduced to 4.5 per cent or even lower in 2013-14, and to 3 per cent thereafter by 2015-16. There must be a visible action plan. There is the need for a regular tracking of this target with month-on-month performance review of key budgetary data. It is also necessary to formulate monthly cash-flow system of budgetary accounting under major heads of receipts and expenditure.

All such information must also be made available in the public domain. Such rigorous scrutiny would send right signals, including to the RBI to move quickly towards softening of interest rates policy; and also avert the prospects of downgrading of country’s credit.
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