India’s Fiscal Follies

Successive Indian governments have embraced “poor-friendly” fiscal policies that deliver little real relief to those in need, particularly the rural poor. With a national election looming, the new budget for 2008-2009 promises more of the same.

NEW DEHLI -- India’s new budget for 2008-2009 says less about the country’s current financial health than it does about the irresistible tendency of Indian governments to use the national budget as a pre-election cudgel. Every year, India struggles to reconcile the irreconcilable: stimulate economic growth and investment, alleviate endemic poverty, and feed a ravenous military appetite. The government must be seen to care about “aam aadmi,” the common man (who votes), while satisfying the needs of businessmen (who keep the economy humming). 

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