Budget 2012

Budget 2012

S N Rao

As the Assembly polls in five states will be completed on March 6, the government has announced that the Budget Session of Parliament will be convened on March 12, and the 2012-13 Union Budget will be presented on March 16. The Budget Session usually begins in the third week of February, but due to the ongoing state elections, the Cabinet Committee on Parliamentary Affairs headed by finance minister Pranab Mukherjee decided to convene the session on March 12 with the President’s address to a joint sitting. The Railway Budget will be presented on February 14 and the Economic Survey, outlining the government’s assessment of the economy, will be tabled on March 15.

Looking at the planetary placement on that day it is found that Ketu occupies Taurus which is the ascendant for the Indian independence day chart. Rahu occupies Scorpio. Saturn in Libra and Jupiter occupies Aries. Jupiter signifies growth and India is a long-term growth story. It has a vibrant democracy, young population and the enterprise to grow. At least this is the view portrayed about India for investors whether local or foreign to encourage them to invest in the India growth story. Jupiter in Aries indicates a plan for reviving the growth in the economy. Hence the main focus is likely to be on growth policies and bringing foreign investments in the country. However the malefic aspect of Saturn on Jupiter indicates that there may not be any major plans or projects which may turn around the current growth of the economy. The Indian government, however, is definitely not in for the long term. The government believes that a series of short term steps to boost the economy and improve financial market sentiments will translate into the India long-term growth story being kept alive.

Saturn is the ruler of the 9^th house and the 10^th house in the Independence day chart. It’s placement in Libra indicates that it is time for long-term steps without worrying about the short-term repercussions. The Finance Minister may take long-term steps for the economy in its budget for 2012-13, which will be presented to Parliament on 16 March. Saturn signifies oil and petroleum products. In the past, the government has taken many short-term steps that will harm the economy in the long term. The first is its inability to reduce fuel subsidies. Oil prices have risen six-fold over the past ten years. An exalted Saturn indicates that the prices are not likely to come down in the near future.

Sun signifies the government. Its placement in Pisces with a debilitated mercury indicates the lack of urge and the intent by the government to take risks in the economic scenario. Inflation has been trending at over 9 percent over the last couple of years, much above the low-single digit levels seen in the first half of the past decade. The main objective of the budget will be to reduce the fiscal deficit by increasing the tax network. We all know what the government needs to do for the long term: reduce subsidies, improve agricultural efficiencies and carry out key reforms in important sectors. However, we all know that this will not happen, as short term is more important than long term for the government.

One of the eg in this regard is the proposal by the finance ministry to increase excise duty from 10% to 12%, although still lower than the level before the 2008 financial crisis. The move, officials argue, is aimed at helping the government improve its fiscal situation but it is expected to push up the cost of almost all manufactured goods - from food products to consumer durables and automobiles. As lackluster growth rates show, these policies are clearly inadequate. Agriculture's environmental impact has been ignored. Yield growth is lagging population growth and consumer demand. Smallholders are sliding further into poverty and malnutrition. More migrants are flooding cities for livelihood.

A hope from the heart of a common man from this budget is that there needs to be firm and strong Government policies that create a virtuous cycle of investment, innovation and sustainability to create a better economy and ease the life of the common man.