Budget Watch: Post mortem

In the post mortem analysis of Pranab Mukherjee's interim budget speech presenting the government's plan for 2011-12, it seems that the budget offers something for everybody but not enough for anybody. 

Calling it a "populist, please-all" budget, the BBC cited Mukherjee's cuts to personal income tax rates, especially for senior citizens, and the increased flow of federal funds to agriculture, education and infrastructure, while the Australian Age emphasized "a 17 per cent increase in social spending in the annual budget, on projects ranging from malnutrition programs to healthcare schemes." 

However, the Guardian takes a shot at India's "economic triumphalism" and declares that Mukherjee's sops won't be enough to address unemployment of the youth or inflation — India's two biggest economic worries.

"This is a budget with very strong income-distribution implications: very clearly favouring the upper-income categories of the population, and likely to reduce real incomes of wage earners and self-employed," the paper argues.

Meanwhile, India's defense sector was disappointed with its increased outlay, which Rediff writes is tantamount to a zero increase when inflation is taken into account. And the property / business sector criticized the decision to increase taxes on investments in India's controversial Special Economic Zones — which have been criticized as enriching real estate developers at the expense of the treasury and poor land owners.

"It is unfortunate that the Government has refused to meet the legitimate expectations of investors who have invested billions on the basis that specific incentives would be available," consultancy Nitish Desai Associates wrote in an explanatory note.