Budget Day in India, as it is in most democracies, never fails to give rise to public excitement. Invariably, the mood of expectation is high, its delivery in the public space results in mood swings, from high to low and high again, until it settles inevitably at a median level. In essence a national budget is an account of the nation’s finances, of revenues, expenditure, and a roadmap to the future.
The budget is also a political document, where some sections of the community are given preference over others and vice versa. Finally, the budget is a government’s facilitator: how to make the country a stand-out for ease of doing business, through reforms, including prompt decision-making, fewer bureaucratic impediments and transparency, hence attractive to foreign and domestic investors alike. The ultimate call on high growth or no growth or something in-between will be made on the factory floor by the workforce, managers, entrepreneurs and industrialists et al. It is their vision, work ethic and enterprise that will, in the last resort, determine the level of economic growth.
Political reactions
Political reactions to the Budget were as predictable as day following night. Prime Minister Narendra Modi described it as ‘futuristic,’ with something for everybody; BJP President Amit Shah lauded it for its ‘fiscal discipline,’ while Congress Vice President, Rahul Gandhi, said he ‘expected fireworks and got only a damp squib,’ an apt description of self no doubt, with no hint of serious analysis, which has never been Mr Gandhi’s strong suite, assuming he has one. He remains as ever unelectable as prime minister.
Banerjee hysteria
Mamata Banerjee, the Chief Minister of West Bengal and head of the Trinamool Congress was her inchoate, denunciatory self, ordering Trinamool MPs to boycott Parliament for two days. Utterly irresponsible and totally misconceived and foolishly counter-productive, many would say. Other, less colourful Opposition leaders mumbled the usual jargon related to ‘ignoring the poor.’
Singh, Chidambaram
Former Prime Minister Manmohan Singh and former Finance Minister Chidambaram claimed the present BJP-led government was ruining the economy; that GDP was not a measure of economic growth, hence an unreliable measure of social prosperity. This was standard fare. Both blitzed demonetization as the root of the trouble, but Mr Chidambaram, asked if he found anything positive about the Budget leavened his reply with just balance, saying, ’Cash transactions above Rs 3 lakh [300,000] has been banned, there is an attempt to reform political funding, crop insurance, has been expanded and there are promises for one crore [10 million] houses and additional capital expenditure on railways and roads.’ (Telegraph February 3).
Banker, industrialist
State Bank of India CEO, Arundhati Bhattacharya, and Mahindra & Mahindra CEO & MD Anand Mahindra were upbeat but measured. The Sensex rose sharply, faster than it has done since 2005. The core sector of the economy grew over 5 per cent in the past month. People and institutions in close proximity to the economy on a day-to-day basis deserve the appropriate respect, even when they fail to command agreement. (See page 3 for comment).
Companies in top gear
Engineering giant Larsen & Toubro registered a net profit of 39 per cent (Hindu January 29); an analysis of financial performances of India Inc indicates that topline growth has rescued large companies. Data for first set of 200 companies (excluding banks and energy) show net sales of companies until January 30, that net sales grew 6.6 per cent year-on-year, this being mainly led by by companies such as Reliance Limited, Maruti Suzuki, Tata Consultancy Services (TCS) etc (Business Line February 1).
Revised growth
India’s economy grew faster in financial year 2015-16 than earlier estimates, according to revised statistical analysis conducted by the Statistical Department. Accordingly, the GDP figure for that year was 7.9 per cent from the earlier 7.6 per cent. According to an IMF forecast for the current fiscal ending March 31, India’s GDP will slow to 7.1 per cent or possibly lower, but the momentum should increase thereafter and recovery to a higher level is expected for fiscal 2017-18 (Mint February 1).
Dell EMC India headcount to rise
Bangalore-based US company Dell EMC is to the expand its Research & Development headcount once stood at 2,500 engineers and now stands at 25,000 and is set to rise further in the coming years, according to top executive Ashley Gorakhpurwala, the company was looking for talent across the entire spectrum of engineering, from systems software solutions, systems management to cloud computing, who said: ‘We are hiring and are looking for talented to work in our Bangalore Design Centre. Over the last five years, we have grown the India R& headcount by 15-20 per cent annually. We expect to hire the same numbers by the year end.’ (Business Line January 28).
HDFC beats profit estimates
Housing Development Finance Corporation (HDFC), India’s largest and oldest mortgage financier, posted a third quarter (October – December 2016) 12 per cent profit, exceeding the expectations of market analysts. ‘By March, individual loan book growth should come back to normalcy. Non-individual has not been affected due to demonetization. We expect to maintain growth of 15-18 in loan book,’ said Keki Mistry, Vice Chairman and Chief Executive, HDFC (Mint January 31).
Piramal buys UK firm drug portfolio
Piramal Enterprises Ltd has bought a drug portfolio for spasticity, a muscle disorder, and pain control from UKK firm Mallinckrodt for $171 million. The acquisition by Piramal’s British subsidiary Piramal Critical Care plans to spin off and list its financial services unit and pharmaceuticals business, said Chairman Ajay Piramal in Mumbai (Mint January 31).
IIM autonomy secured
Legislation has been passed by Parliament to safeguard the autonomy of the Indian Schools of Management, which, forthwith, will be run by their individual boards and not come under the authority of the Ministry of Human Resources Development (Business Line February 1).
Apple ‘Make in India’ planned
Apple announced that it is to manufacture iPhones in India in a plant sited in Bangalore. The Karnataka government issued a press release confirming and welcoming the company’s decision to do so. Stories about this had been doing the rounds since December. The statement was signed by State Minister Priyank Kharge, who explained that Apple’s presence ‘will foster cutting edge technology ecosystem and supply chain development in the State, which are critical for India to compete globally.’ Production is expected to start in June (Times of India February 3).
Jihadi terrorist Hafeez Saeed held
Hafeez Saeed, head of the Jamaat-ud-Dawa and four others were under house arrest in Lahore by the Pakistan authorities. Saeed, also the co-founder of Laskkar-e-Taiba is believed to be the mastermind of the November 26, 2008 jihadi terrorist attack on Mumbai in which 167 innocent citizens died. Efforts to extradite him to India have failed, and he lived in freedom in Pakistan preaching hatred against India and recruiting people for terror assaults on Indian targets.
In a familiar trick, the banned Jamaat-ud Dawa resurfaced as Tehreek Azaadi Jammu and Kashmir in a bid to protect Hafeez Saeed and carry on with its jihadi terrorist activities. It’s a cat-and-mouse game set to continue for yet a while. Meanwhile two jihadis were killed in an Army operation in Sopore at the weekend. The mere shadow of Donald Trump and the possibility of action by Washington has sent the Pakistan government scurrying for cover. Trump has accomplished in a fortnight what the sainted President Obama failed miserably to achieve in eight years over two terms. (Times of India, Hindu January 31, February 5).
Jihadis warning to Pakistan
Jihadi organizations in Kashmir have reacted with alarm at the news. ‘Kashmiri movement is at a critical phase and Mr Saeed would support it. Pakistan’s action is a sign of weakness, which is painful. It has sent depressing signals. It also depicts the weak role of Pakistan in Kashmir’s freedom struggle,’ said United Jehad Council chief Syed Salahuddin. He and other leaders have expressed ‘anger and disgust’ at the decision. Another jihadi leader Muhammad Qasim Faktoo warned that Pakistani laxity in obeying Donald Trump may lead to Indian surgical strikes with American backing. (Hindu February 3).
Laser light to speed up electronics
Indian scientist Manish Garg took the proven step to to produce high-speed electronic devices that can operate one million times faster than present-day systems. Working at the Max Planck Institute of Quantum Optics in Garchin, Germany, Garg and the team used laser beams to generate electrons that moved at a frequency close to one million billion hertz, the best achievable now is one billion herz. The results were published in the prestigious science journal, ‘N N Nature.’ Dr Garg said: ‘We envision that in future, we will be able to to use transistors driven by laser pulses instead of electronics transistors in devices. The technical challenge is to make use of high frequencies to perform logic operations similar to the ones performed inside an electronics transistor and also make it feasible in integrated chips.’ (Hindu February 1).
