Less is more
Budget 2011-12 is a collage that has all the hallmarks of finance minister Pranab Mukherjee, the consummate political artist.
Join the apparently disparate dots and you get a big picture that has elements of what we had expected - pushing financial inclusion, especially in rural and small-town India, controlling inflation, catalysing economic growth and laying down a roadmap to curb black money.
But all the urban middle class, which has been crying out for immediate relief, got were promises of future respite.
Even the extra money the finance minister has put in the hands of tax-paying households by raising the income tax exemption limit by Rs 20,000 to Rs 1.8 lakh, is too little - you will save Rs 172 per month.
Only very senior citizens, a new category of 80-plus tax-payers will gain anything meaningful - a little more than Rs 2,000 per month.
"I am not yet 80," Mukherjee told Parliament with a suppressed smile.
For senior citizens, he has reduced the age to 60 from 65 years.
The Budget has some reformist elements.
So, the direct taxes code will be effective from April 2012. Waiting in the wings are financial sector legislative reforms with the amendment of insurance, banking and pension laws.
Then, inflation is not going to go down in the foreseeable future.
"I expect the average inflation to be lower next year," Mukherjee said.
However, by not taking some of the steps that were expected - like rolling back the excise duty cuts that were introduced in the wake of the economic slowdown in 2008 and indulging in fiscally irresponsible populism - Mukherjee has created a positive sentiment, boosted in no small measure by the projected GDP growth rate of 9%.
The Budget also says the fiscal deficit, which was projected at 5.5% for the current financial year, is now estimated at 5.1% and this is likely to fall further to 4.6% in 2011-12.
Shorn of economic jargon, this means the government will have to borrow less, and there will be less pressure to increase interest rates.
Investors added the sum of the parts and liked what they saw.
The benchmark BSE Sensex rose almost 600 points in intra-day trading before profit-taking and apprehensions over devils lurking in the Budget fine print brought it down to 17,823, up about 123 points.
The other big issue before the country is black money.
Nobody expected an instant solution and Mukherjee's "five-fold strategy" to fight it - including appropriate legislative framework, setting up institutions for dealing with illicit funds and developing systems for implementation - is a good theoretical start, though like all good things, we await implementation.
BJP leader and former finance minister Yashwant Sinha said: "The Budget is completely devoid of reforms".
But it is the Opposition, including the BJP, that is holding back the goods and services tax.
And when critics cry that there are no big-bang reforms, it's time to be more circumspect - just how many big-bang reforms can you expect from a trillion-dollar economy?
Increases in foreign direct investment in specific sectors will happen gradually, not instantly. Particularly controversial is FDI in retail, for which a huge politics needs to be managed.
"The biggest reforms are not the ones that make headline, but the ones concerned with the details of governance, which affect the everyday life of aam aadmi," Mukherjee said.
To give the inflation-weary people a leg up, he has indexed the wages they get from Mahatma Gandhi National Rural Employment Guarantee Act to inflation.
Meaning, if inflation rises by 10%, so will wages, an excellent pro-poor policy.
Additionally, 2.2 million anganwadi workers and helpers will see their remuneration double to Rs 3,000 and Rs 1,500 per month, respectively.
Further, he has doubled the scholarship scheme for scheduled castes and tribes children in classes 9 and 10 to benefit four million students.
The aam aadmi has also got benefits on the housing front by getting subsidised interest rate of 1% if the house is worth less than Rs 25 lakh and the loan is less than Rs 15 lakh (from Rs 10 lakh and Rs 20 lakh, respectively).
Finally, by paving the path for cash transfers on various subsidies like fuel and foodgrains, Mukherjee has taken the first tentative step towards ensuring better delivery of these entitlements.
"This is a budget that matches the challenges our economy faces - sustained growth, inclusive growth, equitable growth - and thus, a determined effort to curb inflation," Prime Minister Manmohan Singh told Doordarshan.
Following are the highlights of the budget:
* Gross market borrowing for 2011-12 seen at 4.17 trillion rupees
* Net market borrowing for 2011-12 seen at 3.43 trillion rupees
* Revised gross market borrowing for 2010-11 at 4.47 trillion rupees
* Fiscal deficit seen at 5.1% of GDP in 2010-11
* Fiscal deficit seen at 4.6% of GDP in 2011-12
* Fiscal deficit seen at 3.5% of GDP in 2013-14
* Total expenditure in 2011-12 seen at 12.58 trillion rupees
* Plan expenditure seen at 4.41 trillion rupees in 2011-12, up 18.3%
* Gross tax receipts seen at 9.32 trillion rupees in 2011-12
* Corporate tax receipts seen at 3.6 trillion rupees in 2011-12
* Customs revenue seen at 1.52 trillion rupees in 2011-12
* Factory gate duties seen at 1.64 trillion rupees in 2011-12
* Non-tax revenue seen at 1.25 trillion rupees in 2011-12
* Service tax receipts seen at 820 billion rupees in 2011-12
* Revenue gain from indirect tax proposals seen at 113 billion rupees in 2011-12
* Service tax proposals to result in net revenue gain of 40 billion rupees in 2011-12
Growth, inflation expectations
* Inflation seen at 5% in 2011-12
* Economy expected to grow at 9% in 2012, plus or minus 0.25%
* Standard rate of excise duty held at 10%
* Service tax rate kept at 10%
* To widen scope of service tax
* To raise minimum alternate tax to 18.5% from 18%
* Iron ore export duty raised to 20%
* Personal income tax exemption limit raised to 180,000 rupees
* To reduce surcharge on domestic companies to 5%
* Subsidy bill in 2011-12 seen at 1.44 trillion rupees
* Food subsidy bill in 2011-12 seen at 605.7 billion rupees
* Revised food subsidy bill for 2010-11 at 606 billion rupees
* Fertiliser subsidy bill in 2011-12 seen at 500 billion rupees