Union Budget 2011 Today : Highlight growth, not loot

He may not be the reform leader, the change agent or the face of India's growth story. But many in the new India and the pink press of today want him to don that role, at least now. Heading into Budget day, our finance minister will be reminded of all that he has not done, the conformist who fitted in rather than looked beyond.

And now, so close to a selfproclaimed and soon- tocome retirement, here's a last chance. Before the polls come too close for comfort, before some other scandal breaks loose in this season of scams, hit it big. So goes the case for some big ticket reforms in Budget 2011. The man who appointed Dr. Manmohan Singh as the RBI governor 30 years ago and now serves under him has an opportunity to take some credit, if not usurp the agenda of a growing and resurgent India, which still remains Dr. Singh's legacy.

But there is the other view: who wants to take on an agenda that has ended, at least for now, with over- glorified industrialists, neorich wheeler dealers and odd fixers all lined up in front of the CBI headquarters in Delhi to be interviewed in criminal cases? If Dr. Singh was the charioteer of the reforms, he ended up giving a ride to quite a few ticketless travellers. Now, there are those who wonder who is in the driver's seat.

It is this chariot that Pranab Mukherjee is being goaded to push further and faster in the hope that more mileage on the road of reforms will bring growth and eventually deliver solutions that have eluded us for so long and kept us a poor nation.

Will Pranab Mukherjee buy this argument? Should he? This is the sixth time that he will stand in the Lok Sabha to deliver a Budget Day speech. The first time he did so was on February 27, 1982, when he spoke of how he had battled inflation but still would not rest because the price situation left little room for complacency. On February 27, 1982, the Lok Sabha heard Pranab Mukherjee stand up to say: " At the end of January, 1982, the annual rate of inflation on a point- to- point basis was only 4.9 per cent as against 15.9 per cent at the end of January 1981... The deceleration in the wholesale prices has occurred in a wide range of commodities, and is being gradually reflected in the consumer price index. However, the price situation requires constant vigilance, and there can be no room for complacency... We must continue our efforts to increase the supplies of agricultural and industrial commodities and also restrain the growth of aggregate demand. At the same time, we must ensure that anti- social elements do not disrupt supplies and the distribution network." Now, the 75- year- old Finance Minister faces a far more difficult fight against inflation in an economy where fewer levers are controlled by the government and where global pressures can quickly transmit to change local prices.

Worse, the fight against inflation is being pitted in some quarters as action against growth, drawing the picture of a country split in the middle between those who want faster growth, no matter what the cost, and those who want to apply the brakes, prevent an overheating and save the larger mass from the burden of high prices.

The senior statesman and trouble shooter for the government that he is, the finance minister will likely say that he wants to do both. Growth must not be sacrificed but prices cannot be high. It's a tight rope, and it's best explained, indeed lost, in numbers, projections and calculations that a vast majority would in any case not care to read, let alone understand.

What the lay reader will look for, indeed craves, is an emotional connect, a clear message that the government has not lost its path, that it still stands for the weak and the downtrodden and that reforms are on course but they are not a ticket to loot.

Indeed, the budget, more than a financial account, should be a reflection of the aspiration of the common people. As John Mathai, the Finance Minister in 1950, said in his budget speech: " I have always held that a Government Budget in the last analysis is a human document in the sense that it involves and has reactions upon the experiences and the emotions of multitudes of men and women all over the country. I think therefore it to be appropriate that its presentation to the people's representatives in Parliament should be somewhat less impersonal." Or to quote Mrs. Indira Gandhi ( Budget speech, February 28, 1970), " Growth and increase in wealth cannot be sustained without due regard to the welfare of the weaker sections of the community. Therefore, it is necessary to devise policies which reconcile the imperatives of growth with concern for the well- being of the needy and the poor." It is plain that times have changed, that this is a globalised economy and that India is a nation on the move and seeking its place in the global order. But it will take much more to turn short term success into a sustainable growth story for the long haul. More than anything, it will require building credibility into the reforms process, or as Raghuram G. Rajan and Luigi Zingales (Princeton University Press, 2004) put it, " saving capitalism from the capitalists" and in the Indian context, saving reforms from rogues and crony capitalism.

It will be a lasting legacy if Pranab Mukherjee can launch that battle cry: We want growth, not loot. As Finance Minister, he even has the instruments and agencies at his command to enforce that order.