Hyderabad, Feb. 26: Back in 1984, the finance minister, Mr Pranab Mukherjee, was a pipe-smoking Bengali babu who would occasionally invoke Kautilya in his speeches. Now, 26 years down the line, he still loves the author of the Arthashastra but not the pipe. The older Pranab is a healthier man. He has quit smoking and now threatens smokers with more taxes. The point is he is trying to make India richer. Along with his health, the country’s fortunes have changed too — since the last time he was finance minister, the economy has grown by leaps and bounds. In 1984, for instance, the Maruti 800 was an “aspirational” car. It is now being phased out. The country’s GDP, foreign exchange reserves, and the government’s tax revenues have all multiplied many times. The economy is poised to grow faster, backed by India’s demographic dividend — there are 500 million Indians below 21 years of age. Over the next many years, the country will have more people in the working age and less old people to support. Today’s Budget sets the tone for the India of the future — policy measures around direct taxes and the Goods and Services Tax (GST) signal the country’s integration with the global economy. The Budget plans to put more money in the hands of citizens, money that can be ploughed back to prop up the domestic economy further. And lower taxes are good news for government coffers as well; they ensure better compliance and thereby more revenues. A win-win situation.
Goutam Das