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Short Takes (IEO NewsDesk)

News and Views on the upcoming Indian Budget

Brief notes on the upcoming Indian Budget... Political scenario, economic undercurrents, conjectures and comments.

• Indian Railway Budget to be presented to Parliament by Railway Minister Mr.Ram Bilas Paswan, on 16th July. The Indian Economy Overview Web site will have full coverage of the railway budget, including highlights, the text of the budget speech, and commentary by experts.
  
  
• Finance Minister Mr.P.Chidambaram is expected to present the Indian Financial Budget 1996-97 in Parliament on the 22nd of July. The Indian Economy Overview Web site will cover the budget proceedings in full, including highlights, the text of the budget speech, and commentary by experts.
  
  
• The United Front government led by Mr.Deve Gowda is an interesting circus, with 15 political parties forming a coalition at the center. A spectrum of ideologies ranging from left to right to unspecified, with one objective, to govern India.
  
  
• The left-wing parties joining the coalition make this the first time a communist Member of Parliament will take a cabinet post in India's central government. The implications on the Union Budget are a matter of international curiousity.
  • UPDATE:Indian Prime Minister Deve Gowda inducts 14 new members, including 5 of Cabinet rank, 2 of whom are members of the Communist Party of India (CPI).
  
  
• The United Front Government has announced that the complete Union Budget for 1996-97 will be announced within the month of July.
  • UPDATE:Budget expected around 22nd of July
  
  
• Respected career politician Ramkrishna Hegde dismissed from the Janata Dal, the primary party of the coalition, for 6 years... All may not be well in the party, feelings run strong.
  
  
• P. Chidambaram, hard core pro-reform Harvard educated economist, is the new Finance minister: he is the author of the manifesto of the former ruling party, the Congress. Industry has unanimously greeted his appointment.
  
  
• The new government has promised opening of the state-run insurance sector to private operators as part of it's "Common Minimum Program", a pillar of its election manifesto. This privatization move is radical in the Indian context, but very attractive from an international viewpoint.
  
  
• The world waits with bated breath for India's position in the Comprehensive Test Ban Treaty (CTBT), India must declare it's stand by the 20th June deadline. This will reflect in global trade sentiments towards India.
  • UPDATE: India has refused to sign the CTBT
    • 61 nation CTBT talks to resume on July 29, India promises to stick with the negotiations.
  
  
• Indian Surface Transport Ministry invites foreign equity participation up to 51% in highway construction ventures, and even 100% in specific cases, to promote transport infrastructure development. These investors may develop real estate along highways to enhance their profitability.
  
  
• In a surprise move, the Deve Gowda government has raised petroleum product prices by 30 to 50%, automobile gasoline is up by 30%. This may be a strategy to raise prices accross the line, before the budget, and attempt to come out smelling sweet as roses in the Budget.
  
  
• Funniest case of political foot-in-mouth in recent history: Senior ex-congressman Bansi Lal's election manifesto promise of prohibition has been enforced in the state of Haryana. Now the Bansi Lal government in the state has actually turned around and sought compensation from the central government coffers, to counterbalance losses in state revenue due to prohibition.
  
  
• Reliance Industries Limited hauled to court: The Indian Registrar of Companies has filed 29 complaints against RIL and the promoters, the Ambanis, one of India's biggest business families. A Mumbai metropolitan magistrate has issued summons to chairman Dhirubhai Ambani, his son Mukesh Ambani and six others to appear in court.
  
  
• The last weeks have been rife with speculation about whether the former Prime Minister of India Mr.P.V.Narasimha Rao, would resign as Congress party president following controversy over his implication in an interenational fraud case, along with disgraced godman Chandraswamy. Mr. Rao seems to have saved his skin, as the party has not ousted him from his post.
  
  
• Enron Power Project at Dabhol in Maharashtra state finally takes off, cleared by the government on 9th July, 1996. The Dabhol Power Company has been losing some US$25,000 per day since the $2.5 billion project was stalled about a year ago.