Some Doubts that Linger on

by R.Mohan
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(03.01.2017) : The address to the nation by the Prime Minister has left some lingering doubts. There is no gainsaying about the fact that the government has the Constitutional right to spend and to tax. It can also borrow. But spending and taxing are done through a budgetary process. An Annual Financial statement has to be laid on the table of the Lok Sabha. Demands for Grants and Appropriation bill will have to be passed for spending from Consolidated Fund of India. Imposition of taxes also requires a similar sanction through passing of Finance Bill, which has to receive the assent of the President.

Nobody can question the right of the leader of the nation to make statements in an address. But, when a Constitutional process is well functioning and a budget just a month away, why these announcements now? The consequences of demonetisation are still fresh and continuing. What was expected were an honest assessment and a few measures to ameliorate the difficulties arising from currency rationing which has hit the economy hard. Cutting lending rate at this stage cannot guarantee credit off take. The animal spirits of the economy are still dormant.

The New Year Eve speech was expected with awe and fear. It was perceived as an enigma wrapped in a riddle. When unwrapped, a few pieces which could have been part of the budget, which is only a stone's throw away, fell apart. Doubts on why this, when the Constitutional budgetary route in Parliament could have been resorted to,still lingers. Confusion gets confounded and waves of euphoria ebb, leaving the citizen guessing "What next?"