A few days before Pranab Mukherjee read his budget speech, I was on some TV panels discussing the Economic Survey 2008-09. The exuberance that business magnates and economists working for private consultancy firms and ratings agencies exhibited at the sweeping pro-reforms wish list that the survey report carried made me realise how disconnected corporate India was from the real India.
I wasn’t therefore surprised when the stock market continued the downslide as Pranab Mukherjee turned the pages of his budget speech two days later. In fact, I now realise that the fall of the stock markets after every budget is so well manoeuvred that we now know how the investors and the TV channels exert public pressure. It is merely a lobbying tool for the investors to extract as much as possible from the government treasury. It doesn’t mean anything else. The nation knows that. Only the electronic media and a section of the print media thinks otherwise, and we know why.
The day the Budget 2009 was delivered, the media was naturally upset. So were the corporate leaders whose pulled down faces told you how frustrated they were at being ignored by the Finance Minister. On the UTVi channel the same evening, Hindol Sengupta said that nearly 44 per cent people who particpated in a poll conducted by the TV channel have expressed satisfaction with what the Finance Minister had presented. I wasn't surprised because I knew how disconnected the media is from the ground realities.
The same evening I heard several talking heads bemoan the neglect of industry and business in the budget proposals. They seemed to be more depressed than the business leaders themselves. Time and again it was said that the hike in social spending that Pranab Mukherjee had focused on was not going to 'deliver' and the failure to further reform (read provide more sops) business and industry would negatively affect country's growth. No wonder the credibility of the media has taken a nosedive.
Economic Times the mouthpiece of business and industry too has acknowledged (ET, July 8) in its report India greets FM's Bharat efforts with hail-storm that even while economists, the stock markets, ratings agencies, and talking heads in the media were rubbishing his first budget for UPA-2 as long on fiscal profligacy and short on deliverables, its focus on Bharat's 'aam aadmi' found favour with the man on the street in urban India. Does it not mean that the man on the street in urban areas is much more in touch with the ground realities and if one may say much more intelligent than these brokers -- economists, ratings agencies, stock markets and the talking heads?
Accordingly, the FM seems to have sold to them his logic that inclusion of the underprivileged and have-nots is enlightened self-interest and could be the panacea for sustained prosperity. As per the results from the ET-Hansa Research Post Budget Mood of the Nation Poll, half of those surveyed across four metros plus Bangalore and Ahmedabad were happy, with the count of sulkers under a fourth.
Compare this with Budget 2008 when P Chidambaram presented the last budget of the previous UPA-1. Remember he provided for a Rs 65,000-crore farm loan waiver which too had not found favour with the economists and the talking heads. That budget was liked by 63 per cent of those surveyed, with another 25 per cent remaining neutral.
Often I hear economists say that providing succour to farmers and the social sector is not economics but politics. I am shocked to hear this. I wonder what kind of economics are we talking about if it does not benefit the masses. Does economics only come into play when business and industry are provided subsidies and tax concessions? Is it not economics when outlays directly reach the poor and marginalised? Probably I am saying this because I am not an economist. If that be so, I am happy that I am not an economist. I have my feet perfectly grounded.