Some important omissions made

Overall, Yashwant Sinha has presented a good and forward-looking budget. The major question is whether the government would be able to implement all the provisions and measures outlined. Would the Central Government be able to downsize its workforce by 2 percent annually? Would the government, given its limited role in the power sector, be able to persuade the states to carry out urgent reforms in the power supply industry? Would some of the socially-oriented schemes be implemented faithfully or would there be usual leakages of resources and funds? Such schemes include those related to people's participation in water harvesting and water management in rural areas as well as measures mentioned for women's empowerment and income benefits for those below the poverty line. The speech omits certain important subjects with respect to sustainable development, which it is hoped will be taken up by Parliament before the Finance Bill is passed. Measures for environment protection or extension of forestry activities were not mentioned. Yet, if poverty removal is an important objective of the government, it is these resources that provide vital services to the poor. The joint forest management programme, for instance, is a unique way of involving local communities in the management and conservation of forests, should have received attention. The finance minister has also dwelt on plans for bringing about 100 per cent rural electrification in six years. Perhaps rural energisation instead of electrification should have been highlighted. Extending the electricity grid to all parts of, the country would be expensive and unviable . Renewable energy technologies can be utilised and implemented at the village-level with much higher technical reliability and, in several cases, economic benefits beyond the extension of grid-based power. Subsidies on kerosene can gradually be shifted to solar lanterns, for which a market is developing. A subsidy on the initial investment on these would be far less costly over the life of these devices than perennial subsidies on kerosene, used largely for lighting purposes in rural areas. The assurance about dismantling the administered pricing mechanism (APM) for petroleum products by 2002 is praiseworthy. This resolves the confusion caused in previous months by statements from responsible functionaries regarding the government's resolve to carry out its plans for dismantling the APM by 2002. Also praiseworthy is the announcement that the ministry of petroleum and natural gas will provide a road map leading to the dismantling of the APM within a year. Given the increased use of private motorised transport, the budget could also have contained tax measures based on the efficiency of different automobiles. The petroleum import bill, which is increasing rapidly and the enormous air pollution problems caused by motorised transport, require the use of much higher efficiency vehicles. Differential taxes rewarding efficient vehicles and taxing less efficient ones would provide the right signals for technological upgradation and efficiency improvements The same yardstick needs to be applied to energy-using appliances and household durables. Notwithstanding the suggestions provided above, which hopefully will receive some attention and enter the Finance Bill, Sinha has done a remarkable job in producing a very sensible and forward-looking budget, which should lead to growth and development.