Competitive Populism Is Here To Stay

GIVEN THE SERIOUS fiscal constraints, Piyush Goyal did a commendable job of remaining within reasonable fiscal slippage parameters.

- Prabal Basu Roy

It is politically astute too as no one in the political firmament would be able to either contest, or unwind, the schemes in perpetuity which have been announced. So as an able and loyal foot soldier, who is also eminently qualified, he has delivered for his political masters. So whilst the wide-ranging welfare measures (read sops) for all vulnerable sections of society would be welcomed, it is the mathematics which leave many unanswered questions on the ability of the government to achieve the targeted fiscal deficit of 3.4 per cent. For example, given that the GST rates are set to decline next year and that collections have been consistently below the Rs 1 lakh crore per month mark, or that the growth in direct tax collections are only 12 per cent till date against 19 per cent projected for the current year, the revenue projections seem to be highly optimistic and the fisc would perhaps be closer to 4. However, if it is a play on galloping GDP growth, apart from tightening compliance, we must remember that in an environment of challenging economic growth – both in India and globally – that too is a risky gambit. Unless, of course, India changes the methodology of computing GDP yet again and thus, mathematically achieves the fisc next year too! The quality of the fisc is, of course, a totally different matter.