THERE is something about the Budget that makes it irresistible to us. It is the one government action that is eagerly anticipated and written about (the other is the much more elusive and mysterious cabinet reshuffle). Even today, when our economic policy shows greater stability and where the Budget is no longer a sword hanging over our heads, the fascination continues.
Perhaps the Budget is the only tangible sign of governance that we can expect to see with confidence every year. All other acts of Parliament are imbued with a surreal sense of randomness, with no way of anyone predicting what business, if any, the House will transact in a given session before being adjourned sine die. Policy making is otherwise invisible when not inscrutable and hence generates little public interest. The Budget, on the other hand, arrives at precisely the right time and sets the agenda for the economy every year. More importantly, at least some of its provisions have a discernible impact on our lives, especially when prices go up or down. This is one of the rare instances when government policy has a direct and demonstrable effect on the lives of the common people.
It was not too long ago that the Budget was anticipated with much dread and when it was behind us, the best emotion one could hope for was relief. The Budget was seen as an economic hit list, with victims being picked out for punishment. Consumers saw it as a fiscal rap on the knuckles, delivered in solemn monotones by grim finance ministers, albeit leavened by some shairi and a couple of jokes. Our main concern, as consumers of the Budget, was with what was more expensive and what became cheaper. We lived lives defeated by prices and taxes.
The underlying discourse surrounding consumption saw it as a regrettable failing on part of consumers who could not prevent themselves from spending money. Such misbehaviour was punished annually, with special treatment being reserved for our vices. Savings were privileged over consumption, and tax deduction opportunities were eagerly looked forward to.
In recent years, we have seen a sea change in this narrative. The Budget is seen as an engine rather than as a drain and is viewed through the lens of expectations rather than foreboding. The finance minister is seen as a Santa Claus-in-mufti (veshtiactually), with all industries sending him a wish list in advance (this year through the swollen tummy of Budgee). The alignment between the industry and the finance ministry is visible throughout the year, with Davos being the place where everyone puts their best foot forward. The discourse around consumption too is undergoing a dramatic change, with stimulation rather than containment being the key motivation. The Budget is today a sign that more people have a stake in the economy, and that the idea of India is closely aligned to the idea of the Indian economy, at least in a certain section of society.
Increasingly, the Budget is a psychological instrument as much as a policy mechanism. Given the stability in long-term economic policy on the one hand and the extreme volatility of the economic environment in the short term on the other, the idea of an annual exercise is no longer as strategically significant as it used to be. The Budget is, however, vital as a communication device. It focuses energies on priorities, crystalises sentiment and unlocks potential. It gives voice to intent even as it shapes expectations.
This year, apart from its main purpose, the Budget must deliver more. It needs to keep the India story going even as the global economic outlook remains bleak. It must frame its proposals shrewdly so as to tell a story of realistic hope. This year, more than in the recent past, the Budget will need to be an exercise in storytelling. For we will be listening to the sound of the Budget even as we pore over its specific proposals. We need some soothing murmurs of encouragement in the dulcet tones of the finance minister. How’s that for a Budget wish list?