Rehan khan 1
FULL MEMBER
- Joined
- Dec 13, 2012
- Messages
- 298
- Reaction score
- -2
Three things about Budget 2016 hold significance for India’s foreign policies – the low priority shown to neo-liberal reforms, the allocation for defence expenditure and India’s vastly diminished profile as donor country in South Asia.
To be sure, in the run-up to the Budget, if the expectations were that Finance Minister Arun Jailtey would press the pedal on ‘reforms’ to embellish India’s so-called growth story, that hasn’t happened. The FDI ceiling was not raised on any sector; no intention has been stated to globalise India’s government banks; no dramatic unfurling of privatization program; no loosening up of restrictions on land acquisition by corporate industry and so on.
For the western countries, ‘reforms’ generally mean greater, easier access to the Indian market, which is the fastest growing among the big economies currently. When their own economies are either in recession or barely recovering, the western countries are desperately looking for markets abroad to generate growth. The annual budget which was unveiled yesterday is unlikely to generate enthusiasm on that score. Yet, the surprising part is that there is an appreciable degree of understanding in the western media about the compulsions working on the Indian government – in political and economic terms. (here, here and here).
Of course there is an element of disappointment and even surprise, but not visible rancor. Actually, it is the Indian votaries of neo-liberalism who are scathing in their criticism of the budget. A leading media figure derisively called it ‘a Budget speech from late Chaudhury Charan Singh’ and a ‘hard swing to old Congress-style agro-povertarianism’. (here).
This brings up an interesting question: the ‘Modi narrative’ as such. Certainly, much of the hype abroad in the most recent years over Prime Minister Narendra Modi’s persona was because he was perceived as a ‘business-friendly’ leader who is a favorite of the corporate industry, is a decisive leader and, therefore, all things considered, could be counted upon to accelerate India’s reforms in the direction of opening up the market far more robustly than Manmohan Singh succeeded in doing.
However, there was always a lurking suspicion as to the veracity of this ‘Modi narrative’. Is he indeed a reformer in the sense in which the neo-liberal crowd means it or Manmohan Singh genuinely was? Is he in the mould of Manmohan Singh (or P. Chidambaram?) Modi’s very first Independence Day speech in August 2014, in fact, conveyed at an altogether different impression. But on the other hand, he gave conflicting signals. To have a suave, urbane, elitist finance minister such as Arun Jaitley was a big contrarian signal, too. Who would have thought that Jaitley could speak with such passion about the Indian peasant?
To my mind, there is bound to be some revolutionary rethink in the West about the Modi narrative. Who is the real Modi? The point is, this is not Arun Jaitley’s budget; it is Modi’s. In its philosophy, this budget is closer to S. Gurumurthy’s thinking than Jailtey’s. The West will watch carefully, much as it understands that the realities of the Indian economic situation and the vibrant and highly competitive electoral politics will ultimately prevail in a democracy such as ours.
Second, in the defence budget allocation, there is an appreciable increase in the capital budget for the Army and the Navy . This suggests that India will continue to remain a Big Bazaar for the arms manufacturing countries. Meanwhile, taking advantage of the unprecedented influence Washington today wields in South Block, the US appears to have succeeded, finally, to push through the 3 so-called ‘foundational agreements’ with the Indians, which would be the stepping stone for building a quasi-alliance between the two countries and a quantum leap in the defence ties. (here and here).
Surprisingly, though, the capital budget for the Air Force has been cut back. Presumably, the Rafale deal is in doldrums. If so, President Francois Hollande would feel unhappy that we pulled a fast one on him — rolling out a red carpet for him on Republic Day and then take away the lucrative deal involving such a lot of money. (here).
Finally, it is shocking that with the solitary exception of the Maldives, the budget allocations for assistance to India’s four key neighboring countries – Nepal, Bhutan, Bangladesh, Sri Lanka – have been drastically cut back. The cutback is to the extent of 16 percent and the total aid allocation for the coming financial year works out to just a little over $1 billion (with Bhutan accounting for over $900 million.). In fact, in dollar terms, last year’s aid allocation for South Asia stood at $1.6 billion.
This is shocking, nay, even bizarre – especially considering that the amount India has offered to Mongolia alone (during Modi’s visit last May) was to the tune of $1 billion. Don’t we have any sense of priorities? Don’t our guys know how to read a map? Where is Mongolia and where our South Asian countries in sheer proximity? Someone in South Block has given the lame excuse that the cutback is because of the lack of ‘ aid absorption capacity’ on the part of India’s neighbors. Is Mongolia’s absorption capacity higher than Bangladesh’s? I bet it isn’t. (here).
India flaunts its competitive spirit via-a-vis China. Is this how we back up our aspirations to be the leader in the region or counter China’s ‘One Belt, One Road’ initiatives in our neighborhood? Pathetic.
On the whole, India’s diplomacy is taking low priority in Modi and Jaitley’s estimation. While the defence allocation signifies a raise of over 10 percent (over the revised estimates last year), the allocation for the Ministry of External Affairs falls, on the contrary, by 2.5 percent (over the revised estimate of $2.5 billion last year.) The defence allocation in Budget 2016 works out to around $48 billion; relatively speaking, India spends about 5 percent of that amount for its diplomacy on the world stage as an emerging power. (here)
However, in the politics of budget allocation in this wicked city, External Affairs Minister Sushma Swaraj and Defence Minister Manohar Parrikar are no match for Home Minister Rajnath Singh. He walked away from the parliament laughing. His ministry has got a fantastic 24 percent hike in budget outlay. The irony lies somewhere else, though. Under Modi government, India was supposed to have been a far more secure place to live. Apparently, it now transpires that the internal security situation is in an alarming state.
Budget 2016 hits India’s diplomacy – Indian Punchline
To be sure, in the run-up to the Budget, if the expectations were that Finance Minister Arun Jailtey would press the pedal on ‘reforms’ to embellish India’s so-called growth story, that hasn’t happened. The FDI ceiling was not raised on any sector; no intention has been stated to globalise India’s government banks; no dramatic unfurling of privatization program; no loosening up of restrictions on land acquisition by corporate industry and so on.
For the western countries, ‘reforms’ generally mean greater, easier access to the Indian market, which is the fastest growing among the big economies currently. When their own economies are either in recession or barely recovering, the western countries are desperately looking for markets abroad to generate growth. The annual budget which was unveiled yesterday is unlikely to generate enthusiasm on that score. Yet, the surprising part is that there is an appreciable degree of understanding in the western media about the compulsions working on the Indian government – in political and economic terms. (here, here and here).
Of course there is an element of disappointment and even surprise, but not visible rancor. Actually, it is the Indian votaries of neo-liberalism who are scathing in their criticism of the budget. A leading media figure derisively called it ‘a Budget speech from late Chaudhury Charan Singh’ and a ‘hard swing to old Congress-style agro-povertarianism’. (here).
This brings up an interesting question: the ‘Modi narrative’ as such. Certainly, much of the hype abroad in the most recent years over Prime Minister Narendra Modi’s persona was because he was perceived as a ‘business-friendly’ leader who is a favorite of the corporate industry, is a decisive leader and, therefore, all things considered, could be counted upon to accelerate India’s reforms in the direction of opening up the market far more robustly than Manmohan Singh succeeded in doing.
However, there was always a lurking suspicion as to the veracity of this ‘Modi narrative’. Is he indeed a reformer in the sense in which the neo-liberal crowd means it or Manmohan Singh genuinely was? Is he in the mould of Manmohan Singh (or P. Chidambaram?) Modi’s very first Independence Day speech in August 2014, in fact, conveyed at an altogether different impression. But on the other hand, he gave conflicting signals. To have a suave, urbane, elitist finance minister such as Arun Jaitley was a big contrarian signal, too. Who would have thought that Jaitley could speak with such passion about the Indian peasant?
To my mind, there is bound to be some revolutionary rethink in the West about the Modi narrative. Who is the real Modi? The point is, this is not Arun Jaitley’s budget; it is Modi’s. In its philosophy, this budget is closer to S. Gurumurthy’s thinking than Jailtey’s. The West will watch carefully, much as it understands that the realities of the Indian economic situation and the vibrant and highly competitive electoral politics will ultimately prevail in a democracy such as ours.
Second, in the defence budget allocation, there is an appreciable increase in the capital budget for the Army and the Navy . This suggests that India will continue to remain a Big Bazaar for the arms manufacturing countries. Meanwhile, taking advantage of the unprecedented influence Washington today wields in South Block, the US appears to have succeeded, finally, to push through the 3 so-called ‘foundational agreements’ with the Indians, which would be the stepping stone for building a quasi-alliance between the two countries and a quantum leap in the defence ties. (here and here).
Surprisingly, though, the capital budget for the Air Force has been cut back. Presumably, the Rafale deal is in doldrums. If so, President Francois Hollande would feel unhappy that we pulled a fast one on him — rolling out a red carpet for him on Republic Day and then take away the lucrative deal involving such a lot of money. (here).
Finally, it is shocking that with the solitary exception of the Maldives, the budget allocations for assistance to India’s four key neighboring countries – Nepal, Bhutan, Bangladesh, Sri Lanka – have been drastically cut back. The cutback is to the extent of 16 percent and the total aid allocation for the coming financial year works out to just a little over $1 billion (with Bhutan accounting for over $900 million.). In fact, in dollar terms, last year’s aid allocation for South Asia stood at $1.6 billion.
This is shocking, nay, even bizarre – especially considering that the amount India has offered to Mongolia alone (during Modi’s visit last May) was to the tune of $1 billion. Don’t we have any sense of priorities? Don’t our guys know how to read a map? Where is Mongolia and where our South Asian countries in sheer proximity? Someone in South Block has given the lame excuse that the cutback is because of the lack of ‘ aid absorption capacity’ on the part of India’s neighbors. Is Mongolia’s absorption capacity higher than Bangladesh’s? I bet it isn’t. (here).
India flaunts its competitive spirit via-a-vis China. Is this how we back up our aspirations to be the leader in the region or counter China’s ‘One Belt, One Road’ initiatives in our neighborhood? Pathetic.
On the whole, India’s diplomacy is taking low priority in Modi and Jaitley’s estimation. While the defence allocation signifies a raise of over 10 percent (over the revised estimates last year), the allocation for the Ministry of External Affairs falls, on the contrary, by 2.5 percent (over the revised estimate of $2.5 billion last year.) The defence allocation in Budget 2016 works out to around $48 billion; relatively speaking, India spends about 5 percent of that amount for its diplomacy on the world stage as an emerging power. (here)
However, in the politics of budget allocation in this wicked city, External Affairs Minister Sushma Swaraj and Defence Minister Manohar Parrikar are no match for Home Minister Rajnath Singh. He walked away from the parliament laughing. His ministry has got a fantastic 24 percent hike in budget outlay. The irony lies somewhere else, though. Under Modi government, India was supposed to have been a far more secure place to live. Apparently, it now transpires that the internal security situation is in an alarming state.
Budget 2016 hits India’s diplomacy – Indian Punchline
