Written by Pratap Bhanu Mehta
March 4, 2015
Developments in Jammu and Kashmir will be seen through this lens: two phlegmatic parties, with uncompromising core ideologies and odd-ball characters in an unlikely coalition.
Prime Minister Narendra Modi’s recent gambits, the budget and the alliance with the PDP in Kashmir, can both be subject to a snarky scepticism that comes easily to us. But they are, in their own different ways, a delicate attempt to take Indian politics into uncharted waters. They are fraught with risks. But it is worth thinking about the underlying radicalism of the politics that could potentially be unleashed.
This budget does not fully live up to the bold strokes of the Economic Survey. But think of the context. Modi was politically vulnerable. His early silences in the face of communal baiting, the loss in the Delhi elections and the sense of a little drift in government cost him political capital. He had to restore authority to government and not give the Opposition more openings. His speeches on religious toleration helped. But he also needed a budget that, while being reformist, did not give the Opposition a handle. There are things to take issue with in the budget, but it gives little ground for potent political mobilisation in opposition.
There are three charges against the budget. Purists balk at the postponing of fiscal consolidation. But private sector investment is not picking up for a variety of reasons. The extent of the institutional mess this government inherited will take time to reform. The budget was more candid in its depth of understanding of the institutional mess. It was no accident that large sections of the private sector were clamouring for more public investment as a means of making India competitive. The budget is premised on some self-belief in government, that is far more progressive than those who make the silly assumption that you can build competitiveness and markets without the state. It could have invested more in building the state. But the greatest strength of the budget is that it has a range of institutional reforms — from the much-debated monetary policy committee to a new bankruptcy code.