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This was the most inconsequential budget

Posted by fairval on March 3, 2013

The last Union Budget of the UPA government did what the last few one have done – focus on welfare spending; and other than lip service little regard for reviving the private sector.

For the 6th year in a row (FY09, FY10, FY11, FY12, FY13, and now FY14e), fiscal deficit will be around 5% or more. Given that, at one point fiscal deficit was supposed to come down 3% by 2007, this is totally criminal. The latest road map now targets 2017 as the year by which deficit would come to 3%. Of course, no one need believe this anymore that the 2007 target.

The projected fiscal deficit number for FY14 is 4.8%. But I dont think the UPA government gives two hoots about this now. If they lose the elections, then the next government cleans up. If the win, then they have 5 more years to loot the country.

Anyway, here are the budget numbers. In terms of likely outcomes: tax revenue projection looks reasonable. Non-tax revenue could once again undershoot, like in FY13. In FY13,  the government cut spends to control deficit, paying some heed to the threat of rating downgrade. In FY14, I suspect, it is unlikely to cut spends, whatever happens to revenue



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