After my relentless writing on the blog, the FM bucks his earlier stand and promises reforms:

That is why I say, always fight it out on the streets for your rights and never get cowed down, your victory will be written on the wall

In another bizzare incident regarding the debate on Homosexuality, everyone from the third rated actress like Celina Jaitley to Dr.Dr Devdutt Pattanaik threw stones only at Baba Ramdev winking at other religious leaders. These timid persons have the courage only to hurt the Hindu Religious gurus. Unless Hindus start kicking the bottoms of these fellows such things would continue to happen again and again....and the Hindu Gurus would be humiliated in front ot 100 Crore population, which is becoming unbearable....

In this connetion, I remember a famous Bengali Poem:

"Mago......vabna keno??

Amra tomar shanti prio shanto cheley...

Tobu shotru ele ostro hatey lortey jani....

Tomar voy nei ma amra...................

Protibadd kortey jani.....!!!"

[Dear ma or mother (Here mother refers to Janmabhoomi or Karmabhoomi), we are your tolerant and peaceful children, but when the enemy comes we know how to wield weapons and fight them out. You do not have to worry dear mother, we know how to protest]

Hence unless the Hindus know how to protest at the correct forum and at the correct time, they would be used a "Football" by all vested interest/ religious groups. Hindus no longer wants to become "Football", but wants to become player.....

As mentioned earlier, none had the courage to say such derogatory words against Muslim/Christian Organisation and some politicians like Laloo Yadav, who also put forward the same argument.

A couple of days back, women's rights lawyer Ms.Flavia Agnes also said some bullshit on Hinduism while talking about mass marriage of some Tribals in Madhya Pradesh. If she has not learnt what Hinduism is, till now, she should come to me, I will make her understand.

It is these people who convert or have earlier converted these poor people through money power into Christians. There is a video in this blog in this direction. The result is that in Mizoram, Meghalaya, Nagaland, etc, we have alien cultures in conflict with the Indian Culture.

If we go back to History we would find that, as a result of Muslim invasions from the West and Northwest, areas lying on way of Muslim invaders, long occupation and mass conversions of the Hindus to Islam at the point of the sword, the Hindu states of Baluchistan, NW Frontier, Punjab and Sindh became Muslim majority states. Afghanistan became completely Islamic. Bengal on the East also became predominantly Islamic -- for reasons best known to all.

The net result was that Islamized areas adopted Alien culture and turned hostile to national Hindu ethos and culture -- ultimately ending up as separate Islamic states of Pakistan and Bangladesh.

There is already a secessionist insurgency going on the in only Muslim majority state of Jammu and Kashmir where almost all the non-Muslims have been expelled. To claim Pakistan is fomenting trouble is to state only half the truth. The insurgency has much support from the local Muslim population.

Some days back there were reports on a section of the media that, Osama bin Laden’s Al-Qaeda network has taken up the cause of China’s Muslim Uighur minority with a pledge to attack Chinese workers in northwestern Africa in retaliation for mistreatment by Beijing of its largest Muslim minority. Al-Qaeda's Algerian-based offshoot, al-Qaeda in the Islamic Maghreb (AQIM), has issued the call for vengeance, according to the South China Morning Post, which quoted an intelligence report from the London-based risk analysis firm Stirling Assynt. It would be the first time that bin Laden’s organisation has threatened China or its interests — underlying the risks Beijing faces as it expands its economic investments overseas. The assessment by Sterling Assynt warned that the threat should be taken seriously and said: “Although AQIM appear to be the first arm of al-Qaeda to officially state they will target Chinese interests, others are likely to follow."

BUT VERY FEW INDIANS ACTUALLY TALKS OF SUCH EVENTS....if one Hindu organisation or one Varun Gandhi says something, Chota Shakeel and his men gangs up to kill that person. There are repeated bomb blasts all over India and whole of India is taken for ransome. It is unfortunate but true that wherever in the world we have Muslim Population, we have the problem of Terrorism, starting from Somalia to Chachenia, to India to Pakistan to Afghanistan to Bangladesh, to USA to UK and so on....The question remains how is the "Religion/Cult of Peace giving rise to so much violence and blood shed, unless something is there in that cult"??!!

Moreover, is Osama Bin Laden the human blood sucker, a Muslim or a Hindu??!! Due to this fellow a large part of India/US's/world resources have been wasted. Now our Shameless PM is in favour of talks with another shameless country Pakistan....

"Kya baat karna hai in logo ke bare main...."...."Sab ki sab harami hai, desh ka dushman......"

The persons like Ms.Flavia Agnes are such Crooks that they cannot do any social work without converting poor people into Christians...Hindu Organisations like Rashtriyo Swayamsevak Sangh (RSS), Ramakrishan Mission, Bharat Sevak Samaj, etc, are doing so much work without doing a forceful/illicit conversions. The truth is that these fellows have two pairs of teeth--one for showing and other for eating foods....

However, the most derogatory obsevation was of the item girl Celina Jaitely (and look alike of Lanny Barby a French Canadian Pornographic Actress), whose body is now like a damaged bridge, no one to ride on it.

The www.rediff.com should be condemned for presenting such derogatory statement against Baba Ramdev, coming from the C-grade actor, who now earns her living selling half naked photos of her in B-rated films to titilate the male audiences.

Before delving into what this uncultured lady said, here is a sampling of what some Muslim/Christian organistaions said:

1. "It is a conspiracy to finish our moral values and those who are involved in such activities have no place in our society," Maulana Syed Jalaluddin Umari, president of Jamaat- e-Islami Hind, told reporters. Maulana Umari also criticised those who cite fundamental rights for legalising gay activities saying such rights are not absolute.

Several Muslim organisations have opposed the government's proposed move to reconsider the Section 377 that criminalises homosexuality as it is against the Islamic laws and against moral values. A dozen prominent Muslim leaders in a statement said that the "Legalisation of homosexuality is an attack on Indian religious and moral values.".The statement had the approval of Maulana Jalaluddin Omari, President of the Jamaat-e Islami Hind, Maulana Muhammad Salim Qasimi, Rector of Darul Uloom Waqf, Deoban, Maulana Mufti Mukarram Ahmad, Shahi Imam of Jama Masjid Fatehpuri, among others.

2. Father Dominic Emmanuel, Director of Delhi Catholic Archdiocese, claimed gay activities would increase the risk of HIV infection. He, however, made it clear that they were not in favour of treating homosexuals as criminals despite their activities are "unnatural". "We are always with them (gays) and ready to offer them counselling as it is possible to bring homosexuals in the mainstream of life," Immanuel said.

3. Kamal Farooqui, chairman of the Minority Commission of New Delhi and member of the All India Muslim Personal Law Board, is known as a modern Muslim. Farooqui is also a distinguished community leader who has done commendable work in giving education to poor Muslim children.

He said, "If my daughter or son would have been such, I would have definitely counsel them. I would have explained them this is unnatural and inhuman. Because this will ultimately lead to the destruction of the human race. This (legal right to have sex with the same sex) cannot come under the definition of 'freedom'. All kinds of freedom have some moral context or ethics. We have to follow those ethics.We should certainly allow them to be a part of our society with counseling saying that they should not get into this kind of immoral acts. For some it may not be immoral but we are Indians, we consider it unnatural. This act is against the human race.I am talking straight. I am talking about the survival of the human race. I am talking about reproduction theory. I am talking of natural process of evolution. Tell me from where reproduction will come? If this is the ideal situation they are talking about, then, where will the world go?we consider them 'normal human beings'. If some deficiency is left in them we take it into consideration and ask them to change. People do have deficiences. We keep them as a part of society. We give them extra care and help. We hug them and counsel them. But, how can we allow them to have immoral acts just because they have a certain deficiency? Who is asking for certificates from anybody? I will speak according to my moral values, my religious values. I won't change my views according to you or as per their demands."

4. Jamiat Ulema-e-Hind, a prominent body of Muslim community, also warned the government of "sexual anarchy" in the society if homosexuality is legalised. "Those opposing the section are influenced by Western culture. Those who argue for independence do not realise that independence should have its limits," said Abdul Hameed Noamani, spokesperson for Jamiat Ulema-e-Hind.

I am not taking either side as I think as long as people's activites do not interfere with the activities of the others, it should not be banned. But a third grade actor like Celina Jaitley with hanging face should not humiliate Joga Guru Ramdev ALONE to this extent. If she at all has the courge she should take on Muslim and Christian Religious leaders as well decently along with Baba Ramdev; because democracy respects individual opinions--India is a democractic country and not an Islamic country.

She wanted show her anger against those opposing Homosexulity and made only Baba Ramdev a scapegoat. It is because she knew majority of Hindus are tolerant and would not do her any harm. By such unfortunate statements she has shown her true worth and shows her upbrining and he education quotient. How many degrees does this ignorant lady has in acting or film making, I want to know........

There is a limit to open ones mouth. Here is a sampling of Celina Jaitley's derogatory comments on Baba Ramdev, who has done so much to popularise Yoga throughout the world. This lady now is in search of cheap gimmicks to make a name.......after her "Half Naked bodies shown in her movies" are failing to "Masterbate" the minds of male audiences. Please go thorough the following.....

1. Reacting to the claim, Celina Jaitley said ‘self-styled doctors’ like Ramdev’s opinion is ridiculous. “With all due respect to Baba Ramdev he may have the so called ‘cure’ but the point is LGBT community does not see homosexuality as a disease,” the actress said. She calls Yoga Doctors as self styled...Does she know that there is another form of treatment called Alternative Medicine (AM), which offer MBBS degree in AM. There is a Yoga College which offers degree in Yoga Therapy. I personally know the principal of one such college who is a Brahmin & has Phd degree in Sanskrit. The doctors coming out of that college are given jobs in government medical colleges. Only an illeterate-moron will say that Sachin Tendulkar or Pt. Zakir Hussein do not have a degree and hence they are unfit for playing Cricket and Tabla.

2. “People should not be judged on basis of what they do in their bedroom because if it was only about that some of our taxes would have to be deployed into a special bedroom vigilance force which I am sure these babas would love to lead,” she said. Look at the last line, "......am sure these babas would love to lead"--this is coming out from a Bollywood actor. Shame upon Bollywood which produces such depleted souls....

3. This third rated actor said, "Baba should limit himself to teaching yoga as ‘he cannot and does not have the qualification or degrees to diagnose an illness without any medical background because it would fall under fake medical malpractice". Celina called Baba Ramdev 'Samaaj Ka Thekedaar' and feels that Baba is on a rant against homosexuality because of his ‘remote upbringing and closed mindset’.

Yes Celina, because of Babajis closed mindset he is so popular throughout the world!! The truth is that in a democracy everyone has a opinion and hence Baba Ramdev is entitled to his opinion. I wonder if Celina Jaitley has the same "Dutch courage" to utter these lines in Saudi Arabi or Iran?? If she does, she would be whipped on an open buttock/bottom (Trousers removed to show the bare skin) in front 1000s of people.....

4. Even if Baba Ramdev screams from every rooftop of India, the reality is homosexuality will not cease to exist."

I URGE ALL TO BOYCOTT THIS LADY AND STOP VIEWING ANY FILMS IN WHICH THIS LADY APPEARS OR WATCH ANY SHOWS IN WHICH THIS THIRD RATED WOMEN WITH PROSTITUTE--LIKE CHARACTER WORKS.

Finance Minister Pranab Mukherjee today sought to soothe industry’s and stock market’s nerves by saying that the government would not monetise the fiscal deficit. Spending a good part of his reply in the Lok Sabha on allaying fears over the seeming lack of reforms in his July 6 Budget, Mukherjee promised a roadmap for disinvestment in public sector undertakings and the financial sector.

Mukherjee justified the government’s huge borrowing programme — a little more than Rs 4 lakh crore this financial year — as essential for bringing the country back on a high-growth path. “During the first half of 2009-10, the government’s market borrowing of Rs 2,41,000 crore of dated securities is being supported by RBI (the Reserve Bank of India) through open market operations (OMO). It has to be understood that OMO of RBI should not be confused with monetisation of government borrowings and that the government has no intention of monetising its debt.”

OMO involves RBI purchasing government securities in the secondary market, as distinct from monetisation, in which RBI lends directly to the government.

Mukherjee maintained that despite the increased borrowings in the current year, the cost had been low so far and the government would not crowd out private investment.

Mukherjee said his ministry had initiated discussions with other ministries and departments for identifying public sector undertakings in which a portion of government equity could be sold, and those that could issue fresh equity to meet their requirements.

Talking of the volatile nature of certain private capital flows, especially those involving foreign institutional investors, the finance minister said: “Though such flows provide critical risk capital with long-term benefits to the economy, the volatile nature of these flows has a negative impact on investments decisions. We have to create the necessary policy environment that helps in addressing such concerns.”

He said the government would look into all issues, legislative or otherwise, necessary to carry forward the reforms to their logical end.

He said the country would return to the path of fiscal prudence without compromising the growth momentum. Expressing confidence that the fiscal deficit will narrow down to 4 per cent in two years – its is projected at 6.8 per cent this year – Mukherjee said the Sixth Pay Commission arrears would have been paid out this financial year.

The increase in plan spending as part of the implementation of the fiscal stimulus had been in the nature of frontloading of the plan expenditure approved for the Eleventh Five Year Plan. “With some effort we should be able to align it with our future requirements,” he said, hinting that the remaining period of the Plan may not see high expenditure.

On the revenue side, the finance minister said much of the decline in business and corporate tax collections was cyclical and could be reversed with the anticipated increase in growth from the second half of the current financial year. With the introduction of the goods and service tax in 2010-11, there could be a sustained rise in tax revenues.

Goldman Sachs earnings easily surpass expectations:

Some media channels are trying to bring in the name of Meredith Whitney for the Rally in the US markets, which is absolutely baseless. It is because she cannot continue to remain bearish on the US economy and other US financials and at the same time, suddenly become bullish on Goldman Sacs??!!

This is what I call these days, "The Media Mafia" who are very active these days: These groups either blackmail people (like Times Now /CNN IBM /NDTV /News 24, etc, are after the BJP now) for the reasons known best to all or take money from some people to give them unnecessary advertisements/publicity....

The internet portal www.facebook.com belongs to this category....

NEW YORK – Goldman Sachs Group Inc. said Tuesday its second-quarter profit easily surpassed expectations as profit was buoyed by strength in its trading and underwriting businesses.

Long considered one of the strongest banks in the financial sector, analysts widely expected Goldman's profit to continue its rebound. Goldman posted a quarterly loss during the final quarter of 2008 amid the mushrooming credit crisis before returning to profitability in the first three months of 2009.

During the quarter ended June 26, the New York-based banking giant earned $2.72 billion, or $4.93 per share, after preferred stock dividends.

Goldman recorded a charge of 78 cents per share as it repaid the government's $10 billion investment in the bank as part of the Troubled Asset Relief Program. The bank had previously announced it would be taking the charge during the second quarter.

Goldman is the first bank to report second-quarter earnings, and analysts predict other banks' results may not be as strong. Others face greater loan losses because of their focus in retail banking, and their more conservative approach to business after the credit crisis could hinder a return to strong profits.

Bank of America Corp. and Citigroup Inc. have been among the hardest hit by loan losses and have yet to repay government bailout funds. JPMorgan Chase & Co. has repaid the government, but still remains saddled with rising consumer loan losses. All three banks report results later this week.

Goldman's results were even better than its fiscal second quarter last year. For that period, which ended May 30, Goldman reported a profit of $2.05 billion, or $4.58 per share. Goldman shifted its quarterly reporting periods after changing its regulatory structure to become a bank holding company last fall amid the deepening credit crunch.

Analysts polled by Thomson Reuters, on average, forecast earnings of $3.54 per share for the quarter on revenue of $10.66 billion.

Goldman's second-quarter net revenue totaled $13.76 billion. It generated $9.42 billion in revenue during its fiscal second quarter last year.

The bank reported a record $6.8 billion in revenue from fixed income, currency and commodities trading during the quarter. Particularly strong trading in credit and interest rate products and currencies help boost Goldman's fixed income, currency and commodities trading. Equities trading revenue totaled $3.18 billion during the quarter due in part to stronger trading in derivatives. It generated $811 million in revenue from principal investments.

After credit markets nearly shut down last fall, equity and debt markets began to recover during the spring as investors optimism for an economic recovery began to grow. During that recovery, companies that had been stretched for capital flooded equity and debt markets with new offerings to raise sorely needed cash.

Goldman was able to take advantage of that crush of offerings, generating record net revenue of $736 million from underwriting equity offerings during the quarter. Total underwriting revenue, which also includes underwriting debt offerings, totaled $1.07 billion during the quarter.

Goldman's profit would have been better had it not been for a charge taken to repay the government investment.

In early June, Goldman became one of the first banks to repay the government TARP funds it received. The government provided banks with capital in exchange for preferred stock and warrants to purchase common shares. The program was launched last fall after Lehman Brothers collapsed and insurer American International Group Inc. needed a government bailout to remain in business.

The government investment also included certain restrictions, such as caps on executive compensation.

Chafing at the restrictions, and with the cash available to repay the debt, Goldman paid the government the $10 billion to cover the loan. The warrants to purchase common shares, however, remain outstanding

FIIs pull out Rs 5,000 crore from equities post-Budget:

The Exodus of FIIs continue though Times of India and Economic Times are trying to do face saving for the UPA. One of the relatives of Sonia Gandhi is reportedly having good holding in the Times Group,

The UPA Government will take us to hell with such High Fiscal Deficit and the Royal Excheque already empty due to ills committed in the last 5 years of its Misrule:

Foreign institutional investors (FIIs) have pulled out over $1.06 billion (around Rs 5,000 crore) from the Indian stock market after the presentation of the Union Budget on July 6. Their net sales in the last six trading days have been Rs 5,240 crore.

However, domestic institutions were aggressive during the period and bought shares worth Rs 44.6 crore. The BSE Sensex has lost 1,512 points, or 10.14 per cent, in the same period.

On Monday, the stocks fell to a two-month low, led by Tata Steel and other metals producers after commodity prices declined, and on concerns that government measures might not be enough to revive economic growth.

Tata Steel, the largest maker of the alloy, slid almost 4 per cent. Hindalco Industries, the no. 1 aluminum producer, declined 3.4 per cent. JSW Steel slumped 6 per cent.

“People want to wait for some positive action because they have been disappointed that nothing has come from the Budget,” said S Krishnakumar, vice-president of equities at Sundaram BNP Paribas Asset Management Co in Chennai, who manages $420 million. Finance Minister Pranab Mukherjee on July 6 unveiled the widest Budget deficit in 16 years and failed to lay out firm plans to sell state-run assets.

The Bombay Stock Exchange’s Sensitive Index, or Sensex, fell 103.9, or 0.8 per cent, to 13,400.32, its lowest since May 15. The drop extended a 9.5 per cent slide last week, the biggest retreat since the week ended October 26.

The S&P CNX Nifty Index on the National Stock Exchange lost 0.8 per cent to 3,974.05. The BSE 200 Index declined 1.3 per cent to 1,627.41.

Tata Steel fell 3.9 per cent to Rs 339. Hindalco retreated 3.4 per cent to Rs 70.3. JSW Steel, India’s third-biggest producer, fell 6 per cent to Rs 485.25. A measure of six metals traded on the London Metals Exchange, comprising copper, aluminum, lead, tin, zinc and nickel, fell 1.3 per cent.

‘No positive trigger’“There is no positive trigger for the market,” said Alex Mathews, head of research at Geojit BNP Paribas Financial Services Ltd. “Weak sentiment after last week’s budget is spilling over to this week.”

Mukherjee said on July 11 that the nation’s central bank would act “as and when” needed on interest rates. “You cannot expect an omnibus reply, but as and when the situation will require appropriate action it will be taken,” he said at a press briefing after meeting central bank officials in New Delhi. The MSCI Asia Pacific Index dropped as much as 2.6 per cent, the most since May 18. The gauge has lost 6.7 per cent from an eight-month high on June 12 as optimism for a global economic recovery eased.

‘Worried’“People are worried about the overall recovery globally,” Krishnakumar said. Reliance Industries, India’s most valuable company, declined 1.4 per cent to Rs 1,750.95. Jaiprakash Associates, the biggest maker of dams, fell 4.6 per cent to Rs 177.5. Larsen & Toubro, India’s largest engineering company, slid 2 per cent to Rs 1,330.1. Reliance Infrastructure, the second-biggest utility, lost 6.2 per cent to Rs 964.45.

The earnings of Sensex companies may decline 6.8 per cent in the quarter ended June, analysts Sanjeev Prasad, Bhavesh Shah and Sunita Baldawa of Kotak Securities said in a research note On Monday. [WIth inputs from Internet]

The India's "Purchased" media tries to do damage control for the UPA, as the FIIs pump out money from the Indian markets to negate the new found "Nehruvian Socialism":

[My addition: The Indian media who might have been paid heavily the UPA bosses to write goodies like it did in the last 5 years, is trying hard to save the face of UPA. One such news is presented below where there was an attempt to create an impression as if FIIs were willing to invest in this new found “Nehuruvian Socialist Economy”. The news which ought to have the headline as: "FIIs only pump Rs.3, 500 Cr in the equities since budget, as mass exodus continues", has been presented in such a way as if FIIs are waiting with basket full of cash to be poured in the Indian Bourses.

On the contrary the FIIs could be looking for newer pastures, elsewhere, especially in other emerging economies, where is no threat of a so called “aam admi” budget. FIIs might have feared that this kind of non-reform oriented budget might lead to a situation, where there would be “aam”, but no “aadmi” to sell “aam”— the dreaded word “Recession”.

All the goodies created by the 5 (five) year of the NDA rule has been wasted, by the UPA in their earlier stint, and now the ills that started to form a pile has now turned into a mountain and is looking unmanageable by the incumbent FM of the UPA. Now they have no option but to shovel the dirt accumulated over 5 years; and the smell is coming out, which his just natural.

The FM has scrapped the Commodity Transaction Tax (CTT) in the Union Budget for 2009-10. While presenting the budget, FM said, “The decision is in step with the recommendation of the Prime Minister's Economic Advisory Council.” So now we learn that PM Economic Advisory Coucil also gives wrong advices. Also, though, FMC Chairman B C Khatua and spokespersons of NCDEX and MCX hailed the decision, but it I think it was a wrong decision. Because such tax could have stopped a bit of speculation of the commodities market. But then if FM is desperately trying to increase the price of commodities, I do not understand why he says it is an “aam admi” budget—quite strange!!. The FM increased the MAT, which will only increase the problem for the corporate world who are already struggling to tide over the financial bottlenecks. The companies would come up with less Net Profit leading to the decrease in the EPS of the Sensex and Nifty.

The result: Sensex may not touch 18, 000--19, 000 at the end of CY09, as was predictedearlier. So we the "Poor Scapegoats" (investors) of the Indian markets now have to witness double kicks on our bottoms: First from the exodus of the FIIs and the 2nd from the latter.

The FM has tried to deliver huge amounts (Rs.39, 000) to a bottomless pit called NREGS. This money like the previous year would only fill the pockets of “Netas and Babus”. In order to provide growth the total expenditure rose to 36% over FY09, which essentially means the UPA Government has to borrow around Rs.6 lakhs crore, which raises heart beat. In other words though the UPA tried to project this budget as pro poor and good, but I feel that it is another “Lost Opportunity” for the UPA Government to give a direction to the investing community. There is a sanskrit saying, "Rinong Kritya Ghritong Pibet" (Eat Ghee taking loan from money lenders)--so the UPA wants to do infrastructure expansion by opening "loans melas".

The FM says, 6.8% fiscal deficit (excess of government expenditure over its income) is nothing compared to US----"Hey Bhagwan" now our economy is being compared with the chequered economy of the US???????!!!!!!!!!!!!!!! Moreover, on including off-budget items such as fertiliser and oil bonds, the deficit figure will stand at about 12% of GDP. Also, did the FM consider the fiscal deficit of the states also......Now calculate the combined fiscal deficit of this great country.....Isn't it look scary??!! If M K Gandhi were there, he would have said, "Hey Ram"...

The Finance Minister's 'no comments' in the recent budget on how he will be lowering India's fiscal deficit in the years to come has made rating agency S&P quite concerned over the country's outlook. "We continue to believe that such high levels of government deficits are unsustainable in the medium term, although we weren't surprised by the number itself," said S&P in a statement. Currently, the agency has given a rating of BBB- which is one step away from the 'junk' status. Any downward revision on this rating could lower India's appeal with foreign investors.

Now if FM wants to kill the capital market, like the Left wanted to do in the last few years when they had their umbilical chord tied with the UPA, then it will be a grave mistake. It is because if there is no vibrant capital market, then from where will the corporates raise funds for expansion??!! Will they have to knock the doors of banks/NBFCs every time they need funds??!! This is another example of “Marxist Utopia”.

The FM in the midst of budget speech suddenly talked of the Nationalisation of Banks---that gave a very bad signal to the FIIs, who wants government to be out of business of business.

In light of this, while the government's focus on restoring India's growth to 9% of GDP may be laudable, the million dollar question is - will the fiscal deficit really allow India to grow the way it had done in the past? Readers would do well to recall that during the last two years when India had been logging in growth rates of 9% plus, the fiscal deficit situation had been under control at a little above 3%. Hence, for India to replicate its growth story, the fiscal deficit will have to be brought down.

Surprisingly, no measures were announced by the FM in terms of how the government was planning to bring this down.

With not much being done in terms of reducing subsidies and the credit crunch keeping interest rates high, the non-plan expenditure is only set to gallop. This has left little room to focus on infrastructure development, education and healthcare even though the FM has emphasized the importance of the same.

Printing more money is not an option as that will only fuel higher inflation going forward. The FM's silence on the FDI front also does not bode well given that the same can play a significant role in enhancing the performance of the economy in the long term. India's rising deficit means that the possibility of its rating being downgraded cannot be entirely ruled out. If this happens, borrowings will have to be done at higher interest rates, which will further exert pressure on government finances.

FM should note that killing the golden goose called the “FII Investments” with the “Nehruvian Socialism” will only be called myopic. The sooner the UPA learns this lesson, the better will be for the Indian economy. The Congress in its new “Socialist” avatar will get little cheer from the FII benches and from the stock market participants].

FIIs invest Rs.3,500 Cr in equities since Budget

[Wrong headline]

New Delhi: Foreign institutional investors (FIIs) have made a net investment of Rs3,500 crore in the Indian stock markets since the presentation of the Budget in Parliament on 6 July, even as the benchmark index Sensex lost over 9% in the same period.

An analysis of FIIs activity in the domestic markets shows that overseas investors were the net purchaser of Indian stocks worth Rs3,499.5 crore during the last week.

FIIs were the gross buyer of shares worth Rs17,092.1 crore during the week, while they sold equities valued at Rs13,592.6 crore, resulting in a net inflow of Rs3,499.5 crore, as per the data available with the Securities and Exchange Board of India (Sebi).

Significantly, during the past week, the Bombay Stock Exchange’s benchmark index Sensex - composed of 30 bluechip stocks - dropped 9.44% to end at 13,584.22 points.

On the Budget day, FIIs booked profit and sold shares worth Rs351.3 crore, dragging the benchmark indices in the negative zone. The Sebi compiles the trade data one day late.

On 6 July, the day finance minister Pranab Mukherjee presented general Budget in the lower house of Parliament, Sensex suffered the biggest fall on any Budget day and in the year too by plunging over 870 points on concerns of high fiscal deficit.

Mukherjee said the fiscal deficit may rise to 6.8% of gross domestic product in the year 2009-10, the highest since 1994.

In five trading sessions from 6 July to 10 July, FIIs were the net seller for three sessions, while, for other days they remained net purchaser.

During the week, the foreign investors also put in money worth Rs2,984.9 crore in the debt market segment, while so far this year, FIIs are the net seller of Rs1,356.10 crore in debt instruments. [From Internet]

PM confident India can sustain 8-9 per cent growth

"Chingaaree koee bhadake, to saawan use buzaaye

saawan jo agan lagaaye, use kaun buzaaye?

Patazad jo baag ujaade, wo baag bahaar khilaaye

jo baag bahaar mein ujade, use kaun khilaaye?

Hum se mat poochho kaise, mandir tootaa sapanon kaa

logon kee baat naheen hai, ye kissaa hain apanon kaa

Koee dushman thhens lagaaye, to meet jiyaa bahalaaye

manameet jo ghaanw lagaaye, use kaun mitaye?"

[Update-II]

[With such a devastating budget, I do not know whether our bureaucrat PM is in Utopia or is thinking of visiting Utopia in the near future.......The lacklustre "election budget" presented by our FM, is already leading an exodus of FIIs. With such High fiscal deficit and no budget loolly-pops like disinvestment and probable rise in interest rate, I am fearing the worst--the dreaded word, "Deflation" (It is a negative inflation rate. Deflation means the value of money will increase. Deflation is often associated with periods of negative or stagnant economic growth, eg. Great Depression, Japanese economy in 1990s, early 2000s. In fact deflation is often used to express a declining economy. This may seem like a great thing to consumers, except that the cause for deflation is a long-term drop in demand. Unfortunately, a drop in demand means that a recession is already underway, with job losses, declining wages, and an ongoing decline in the value of your home and your Stock Portfolio. This declining prices, if they persist, generally create a vicious spiral of negatives as mentioned earlier, such as falling profits, closing factories, shrinking employment and incomes, and increasing defaults on loans by companies and individuals).

Though to counter deflation, the UPA has taken some expansionary monetary/fiscal policies (reducing interest rates, put more money into circulation by lowering taxes, increasing government spending, and incurring a temporary deficit, in an attempt to jump-start economic growth) but this deliberate attempt to effect a price rise, could cause "Hyper-inflation" or may be worst "Stagflation". Also, like inflation, deflation is very difficult to combat once it is entrenched. As businesses and people feel less wealthy, they spend less, reducing demand further. Prices drop in response, giving businesses less profit..

Rising prices provide an essential lubricant for any sustained recovery because businesses increase profits and take some of the depressive pressures off wages and debtors of every kind..

Moreover, the RIL-RPL tussle could become a fly in the ointment. Hence, it is all probability, the markets could move towards the southern Hell Gate.

When these kinds of "Political Budgets" are made to win elections rather than helping people, Nifty Supports and all those Chartical Parameters become redundant....When FM has made up his mind to show the "Exit Route" to FIIs what can the domestic investors do except to get hard kicks on their bottoms. If UPA does not have anyone to become a reform oriented FM, they should ask the NDA to provide one.....

However, there is single letter word which could help us, "Hope"......Otherwise, it is now almost certain that the "UPA-Octopus" will kill the Indian Capital Markets in the near future......but some people will never learn lessons. Yes these fellows will vote the same formation in the next assembly elections by flogging the emotive issues like, Gujarat Riots or Varun Gandhi (without thinking even for a minute what former Congress minister Kagodu Thimmppa reportedly said at a public meeting in Shimoga district: "The hands of those who propagate Hindutva should be cut off") or Kandamal Riots (Overlooking the fact of illicit conversions of Hindus and killing of Swamiji)..................pata nahi kya kya.....topics.....comes next time........or stay at home during the voting day (the next assembly elections), enjoy the holiday, and get all of us screwed. However, you will find that most of the Television audiences are from Delhi and Bombay (where the voting percentage hardly crosses 55%) only, who give us pre-election lectures on Voting. These fellows who give us lectures from Television studios and do not vote, should be tied to lamp posts and whipped mercilessly.

It is lamenting how UPA got voted to power this time which was responsible for Mumbai carnage (nothing worthwhile has been done till date), a series of bomb blasts (nothing happened in case of Assam Blasts), high fiscal deficit, etc.

Today in a surprising move our personality-less Prime Minister, spoke in a rather apologetic tone (almost in a sobbing note as if this "Corrupt Fellow" whom many Pakistanis call "Goonda President", is Lord Rama; for reasons best known to all): "It was not my intention in any way to hurt Zardari Sahib's feelings,".....Sheeeeeeeeeee......we have this kind of coward Prime Minister .....

This UPA Government is already in dire straits, due to ills committed during its earlier stint----it thought it will never come back to power and hence did all those evils in the last 5 years...All those talks of reforms are now in a Waste Paper Basket, waiting to be unloaded inside the nearest insinuator. Woh!! This is our democracy for which we are so proud of......

Mr. Fakhri H. Sabuwala writes in a noted Bombay based Financial Weekly, in his column, "Kambakht" Budget: "What else should one call the ‘Big B’ when the market lost nearly 900 points on day 1 and another 800 points by the end of the week. The budget proves beyond doubt that the UPA in its new avatar, too, is suffering from the Left syndrome. They could hardly think any different from the Common Minimum Programme, which was an integral part of the old UPA regime. The finance minister (FM) and his team of bureaucrats failed to carry forward the hope & optimism generated by the poll results and the Economic Survey. Such inaction was probably due to political compulsions of pleasing the orthodox within the Congress party and the UPA allies who raised their eyebrows on the petrol price hike."]

New Delhi: Notwithstanding the uncertainty surrounding the global economic recovery, prime minister Manmohan Singh today said India should be able to sustain a growth rate of 8 to 9 per cent GDP growth.

He said he was confident that India would come out of this crisis stronger but the road ahead was also going to be difficult to traverse.

"It is not not going to be easy but I am convinced that India's savings rate, which is as high as 35 per cent with a normal capital output ratio of 4:1, we should be able to sustain, with a little bit effort, a growth rate of about 8 to 9 per cent notwithstanding the difficulties on the international front," Sing told reporters accompanying him on his way back home from a four-day visit to Italy.

Against the backdrop of the world attempting a recovery from the recession caused by the financial crisis in the heart of the developed world, he said he had discussions with the leaders of G-8 and G-5, Egypt and African countries.

"After our discussions, it is my sense that while there are some signs of recovery, the world economy is still a long way from recovering the earlier growth momentum and there must be questions whether that will soon be possible for the global economy," he said.

The prime minister said he was returning home convinced that India must continue to strengthen steps at home to regain the 8 to 10 per cent growth path.

The prime minister said international environment would not not be as supportive as before for some time to come. "I am, however, confident that our domestic economic strengths will enable us to return to our earlier path of rapid and inclusive growth."

He said in his statement in the G-8,G-5 summit he did mention that all available indicators for 2009 point to a deceleration in the US economy in the European Union economies and, therefore, one can say that the global environment for the development of the countries of the third world has undergone a sharp deterioration.

Singh noted that India's exports have suffered, capital flows from abroad have declined and international bank lending to the developing countries has declined.

"Therefore the challenge before us is to sustain and revive the growth momentum which we have built up in the last five years notwithstanding the deterioration in the international environment for development," he said.

Answering a question, Singh said he had always viewed his government's role was to get rid of chronic poverty, ignorance and disease which still afflicted millions and millions of people.

"We have made some important gains in the last five years.We managed to impart to our country a stronger growth momentum.We strengthened the forces which make for inclusive social and economic development," he said.

He mentioned that the government had put in place social safety nets which soften the harsh edges of extreme poverty substantially.

"But this is a long and arduous journey and our challenge is to take full advantage of the instrumentalities which are now now in place for inclusive growth to plug loopholes, to reduce leakages and to ensure that these instruments become more effective instruments of social and economic change, accelerated growth, more inclusive development and more emphasis on rural development and agriculture."

Singh said it was a continuation of the journey they undertook for five years with renewed commitment and determination even though it must be recognised that the international environment was not not as supportive as was imagined at one time. [From Internet]

Suzlon Energy Ltd: Charged up on new order win:

Atlanta Ltd having infrastrucutre, mining, real estate, Land Bank, etc . story hit the upper freeze.

Ennore Coke Ltd, Prajay Engineers Syndicate Ltd, Sicagen India Ltd, Glory Polyfilms Ltd, etc, should be accumulated on all declines.

The markets as mentioned yesterday formed a temporary bottom, which seemed to have been confirmed today.

Suzlon Ltd which is expected to get some sops from the Union Budget for FY10 (See below or previous writings in this blog), is doing extremely well today and is rising up with huge volumes. Today it signed 224 MW European framework order with EUFER.

Suzlon Wind Energy Ltd Espana SLU, Spain a wholly owned subsidiary of Suzlon Energy Ltd has secured a new framework agreement with EUFER (Joint venture between ENEL Green Energy and Spanish Utility UNION FENOSA for renewable energy business in Spain and Portugal) for supply and installation of Suzlon 2.1 MW wind turbines for wind farms totalling 224.5 MW. These machines are proposed to be installed up to financial year 2010-2011.

Suzlon Ltd also expressed its commitment to assit in the industrialisation plans for Andalusia with blade manufacturing facility. This is in continuation of series of orders it won in the last few days. The stock could again be moving towards Rs.110--120, in the next few trading sessions.

The markets to bounce back today, as the Nifty finds a temporary bottom:

What I feel is now is that the hangover due to budget-stupor seems to be over and the markets should bounce back today. Yesterday, during the market hours, investors (Those who were on my Yahoo Messenger) were asked (through SMS) to cover up their shorts, in view of the Nifty making a temporary bottom on the bourses. Now you can go long on Nifty with a SL of 3940 (spot). Yesterday, Country Club Ltd was recommended at Rs.20.40 to the Investors (on my Yahoo Messenger) for a target of Rs.29--30, in the next few trading sessions. Also, both Suzlon Ltd, Prajay Engineers Syndicate Ltd (Construction/ Development of Property & Hospitality — Hotels and Resorts) and Ritesh Properties & Industries Ltd are looking good for fresh investment. Please do not look at the Q4FY09, results of Prajay Engineers for investment in the scrip. These reasults are just aberrations. It is to be noted that for Prajay Engineers Syndicate Ltd, Sundry Debtors considered good include an amount of Rs. 30635.67 Lac due from customers which are outstanding for more than 6 (six) Months. The company says that, "As a result of economic slowdown and slowdown in reality sector, realisations from customers are Slow." Hence the results for subsequent quarters will be superb.....Moreover a company having in upcoming 5-star hotel project and exiting 3-star hotels and resorts, land bank of more than Rs.1000 Cr, Book value of Rs.152, etc. cannot trade at such a dismal price. I think like Atlanta Ltd, it will suddenly come up with splendid results.

Suzlon Energy Ltd informed the BSE today, regarding receiving NEW orders totalling to 114 MW:

The market cut losses in mid-morning trade on media reports that the government will have a disinvestment road map in place in about three months to bridge the high fiscal deficit. This is very positive move and could end this long drawn correction in the markets..

Suzlon Ltd was recommended in this blog in the morning and now (today) this good news has come. Suzlon Energy (Tianjin) Ltd a subsidiary of Suzlon Energy Ltd further strengthened its presence in the Chinese Wind Energy Market with an order for 48.75 Kw. The contract for 39 sets of S.64--1.25 MW capacity was signed with Datang Power Co. The turbines under this order are expected to be delivered and commissioned by the third quarter of FY10. Suzlon Enegy (Tianjin) Ltd further got another order of 50MW. The contract for 40 units of 1.25 MW capacity was signed with Honiton.

Suzlon Energy Ltd got repeat order of 10 units of S.82--1.5 MW turbine from KS Oils Ltd. KS Oils Ltd Started with 2.5 Mw project in Madhya Pradesh with Suzlon and placed 6 orders with Suzlon Energy Ltd till date.

Government slashed customs duty on wind power equipment to 5% (five percantage), The scrap of FBT is a welcome move and definitely benefit the big corporate, especially the IT companies.

Positive for Suzlon Energy Ltd (CMP: Rs.89.10)

Chart Indicator: Highly Oversold

Spot Nifty has strong supports in the range of 4050--4080.....

ESSAR STEEL is close to acquiring a majority stake in Shree Precoated Steels of the Ajmera Group.

TATA STEEL’S sales volume surged by 22% to 1.4 million tonnes in the first quarter of the current fiscal on the back of robust demand from the auto and construction sectors.

The country's sugar consumption is seen to be up by 7.14% to 22.5 million tonnes during 2008-09 season, though production is seen lower at 15.5 lakh tonnes for the same period..

To help promote power generation through renewable sources of energy, the government reduced the basic customs duty to 5 per cent on permanent magnets, a major component for wind power projects, "I am reducing the basic customs duty on permanent magnets-- a critical component for Wind Operated Electricity Generators from 7.5 to 5 per cent," Finance Minister Pranab Mukherjee said while presenting the Annual Budget.

"It is imperative that the contribution of new and renewable energy sources of power is enhanced if we have to successfully combat the phenomena of global warming and climate change," he said.

"It is a welcome decision, we will see the Budget document and access how helpful will it be for the industry," Indian Wind Turbine Manufacturers Association Honorary Secretary V D Kalani told PTI.

The Ministry of New and Renewable Energy (MNRE) has fixed a target of 10,500 MW wind power during the current XIth Five Year Plan Period (2007-12).

During the 10th Plan (2002-2007), India saw installation of 5,426 Mw of wind power generation capacity, as against the target of 2,200 Mw.

India is currently the fourth-largest generator of wind power in the world with a capacity of 8,696 Mw.

The AASU burns effigy of Union Finance Minister,

Dr. Pranab Mukherjee

DIBRUGARH: The Dibrugarh district unit of AASU (All Assam Students Union), a very powerful students' wing in Assam, burnt the effigy of the Union Finance Minister Pranab Mukherjee here today to protest against the neglect of Asom in the Union Budget tabled yesterday.

While talking to a Assam based daily, the assistant secretary of AASU, Rituparna Barua, said that the Union Minister allocated Rs.1,000 crore and Rs.500 crore as relief fund to West Bengal and Mumbai respectively but ignored Asom totally. The State continue to be assailed by the flood and erosion problem but the Centre seem little interested in solving it, he added. The student leader termed the Tarun Gogoi led Government a failure for failing to fight for the interest of the State.

Meanwhile the AUDF Supremo, Maulana Badri Uddin Ajmal, also lambasted the UPA Government at the centre on this issue saying, "If West Bengal and Maharastra can get relief why the entire North East was made a victim??" A letter was submitted by him, on behalf of the UDF, to the Union Finance minster on this issue and asked him to come up with a white paper soon.

Maulana Badriuddin Ajmal, the UDF (Undeclared Muslim League of Assam) supremo, criticizes ‘anti-minority’ budget of the Congress led front in Assam

GUWAHATI: Lambasting the Congress-led Asom Government for its anti-minority policies, AUDF president Badruddin Ajmal said the recently laid budget in the State Assembly has once again proved the anti-minority policies of the Congress government.

Stating that the recently laid budget proves the hollowness of Gogoi’s promises towards the minorities, Ajmal said, "The Honourable Chief Minister failed to start his speech with the State government’s initiatives for the welfare of the minority communities as there has been none to demonstrate. Likewise, he ended his speech without announcing any new programmes for the welfare of the minorities as he never had any intention of doing so."

He further said, "Unlike the welfare schemes of other groups of people, the buget speech on welfare on minorities did not spell out the total amount earmarked for the minorities, whether there has been an increase or decrease, the status of the major promises of the earlier years, etc."

He further said, "In his 2008-09 budget sppech, the Chief Minister had announced his decision to launch a special programme for the all-round socio-economic development of the minorities after due consultation with representatives of the minority organizations. He said that an amount of Rs 25 crore had been set aside for the project, which was supposed to start in the next financial year. In his recent budget, the Chief Minister, surprisingly, remained completely silent on the fate of the special programs for which the assurance had been given in the floor of the Assembly one year back."

Terming the State government’s decision to refrain from increasing the allocation for Minorities Development Boards / Corporations as another example of deception, Ajmal said that the earmarking of Rs 5 lakh for setting up a Minority Education Commission is mere eyewash, as no commission can be made functional with this amount. "It is sure that this will have the same fate as the special program announced in 2008-09 for Rs 25 crore."

Reforms’ progressive regression Government is growing, so are deficit and subsidy

By R. Balashankar

[The discussion paper on subsidies produced by the Finance Ministry in 1997 said, “The proliferation of subsidies in India can perhaps be linked to the expansion and growth of governmental activities. Apart from basic and traditional functions like defence and maintenance of law and order the government has extended into producing a wide range of goods and services often in competition with the private sector.” The study said in many of these activities the government incurred huge losses. The idea of downsizing or trimming the government had its origin in this analysis].

What has happened to the promise of down-sizing the government, lowering fiscal deficit to manageable limits and scrapping all pompous and wasteful subsidies which formed the core strategy of economic liberalization unleashed in 1991? We are back to square one. Blame it on global meltdown or an obstructive and deeply entrenched bureaucracy, or the monstrous political appetite for profligacy with public money for electoral gain—18 years into economic reforms—India is hostage to a burgeoning state machinery, double-digit fiscal deficit and a subsidy bill which is siphoning away an unprecedented chunk of the GDP into fanciful welfare schemes meant only to curry favour with entrenched vote banks.

It is fascinating to evaluate our present status with all that was promised at the time of introducing economic reform. Seven major areas of policy reform underlined by the then Finance Minister Dr. Manmohan Singh were fiscal, trade, industrial, financial, agricultural, poverty alleviation and human resource. A major plank of the fiscal policy was to improve the fiscal balance and eliminate budget deficit. For this, emphasis was laid on reducing the level of subsidies and eliminating open-ended cross-subsidisation, to direct government expenditure towards providing essential services of a high quality. It was promised that the government would withdraw from all areas where the private sector was better equipped to operate.

We were told that the Planning Commission had become redundant after the government said goodbye to socialist pattern of economic planning. The fate of the PIB (Press Information Bureau) and even the Information and Broadcasting Ministry was predicted to be similar. It was the socialist, totalitarian type of regimes that needed to plant stories to pep up their image. According to this liberal capitalist school of thought, the government was to wither away from many areas. They identified ministries such as Railways, Tourism, Civil Aviation, Industry, Food and Agriculture, Textiles, Petroleum, Coal and Mines, Steel, Programme Implementation, Shipping and Transport as areas for pruning. There were also suggestions to the effect that Communications Ministry was a drain on the exchequer and regulatory authorities like TRAI were enough to fix tariff and set rules. There was supposed to be level playing field for market forces. The flattening of the government however did not happen. Today the government has become a behemoth.

The government was then busy retrenching through VRS and golden handshakes. It was projected as if the government was not the agency to create jobs. The votaries of this new binge reform suggested that the quota and reservations under Mandal Commission, etc, would become useless as there was no job or opportunity in the public sector. Today, the nation is heavily leaning on the government to generate new employment opportunities.

Stimulus is the new word for bailout or, if you like, for subsidy. Everybody wants stimulus. Pink press is pleading for Stimulus Package—Three in the budget. Remember? They were in the frontline crazy yelling, “there is no free lunch” in free economy. Now industrialists who were supposed to be the saviours and job creators, in the new economy—the captains of growth—want more subsidy, lower interest loans than that to the poor farmer.

We were further told that there was no need for India to produce those costly, wheat and paddy, vegetable and fruits. These are produced cheaper and in larger quantity by American and EU farmers. We need to concentrate only on cut flower, shrimps and cash crops which will not compete with the West and earn foreign exchange. After last year’s food crisis the government is going to introduce a food security bill in Parliament. Is it that reformers have got a new insight? Or have their masters in the IMF-World Bank become wiser by experience? Clearly their original format was flawed. These are interesting input for an academic debate on globalisation in these days of recession and redesigning of capitalism.

Yojna Bhavan will become an extended coffee house (there was one) in the private sector, we were told. Because the Five-Year Plans sounded like the commanding heights of the public sector under Nehruvian socialism. What has really happened? Planning Commission chairman has today become more powerful than the Finance Minister and it has become so intrusive that the chief ministers are made to stand waiting with their demands. The number of ministries has only increased under Manmohan Singh. He created two new ministries—one for the minorities and another for overseas Indians. In the hey-days of reform, we were told, the External Affairs Ministry would double up for Industry and Commerce also.

Look at the humongous size of the ministry Dr Singh is presiding over now. Consequently the wasteful expenditure of the government has increased manifold. The new food security bill announced during the poll campaign is estimated to cost an additional Rs. 50,000 crore. The loan waiver which is supposed to have swelled the Congress vote cost another Rs. 72,000 crore. Another pet scheme, NREGS, which is now going to be further widened to new areas as it brought the rural poor closer to the Congress cost the country Rs. 1,62,000 crore. By the time you read this piece the new Finance Minister Pranab Mukherjee would have presented his budget for 2009-10. Unless he fudges the figures, as his predecessor used to do expertly, the budget deficit will cross double digit.

P Chidambaram, the man who presented the largest number of budgets in Independent India, had a fetish for Fiscal Responsibility and Budget Management Act, 2003, though it was passed under the Vajpayee government. Ever since in every budget he used to repeat, “I am happy to report that we are on course to achieve the FRBMA targets.” The statement placed in Parliament by P Chidambaram on FRBM in February 2008 promised zero revenue deficit for 2008-09 and 2009-10. Fiscal deficit for these years promised was 2.5 and 3.0 per cent respectively.

What has gone wrong with the government’s target of fiscal consolidation? Perhaps the UPA-II has decided that winning election is more important than managing financial discipline. Reform was expected to remove all unproductive, populist subsidies. The government has brought out a number of discussion papers on subsidies with a promise to do away with all cross-subsidies which essentially catered to various power lobbies. The discussion paper on subsidies produced by the Finance Ministry in 1997 said, “The proliferation of subsidies in India can perhaps be linked to the expansion and growth of governmental activities. Apart from basic and traditional functions like defence and maintenance of law and order the government has extended into producing a wide range of goods and services often in competition with the private sector.” The study said in many of these activities the government incurred huge losses. The idea of downsizing or trimming the government had its origin in this analysis.

This involved withdrawal of the government from many areas, divestment of the Public Sector and abolishing or merging the numerous ministries which were supposed to be encroaching upon the private economic space.

Under UPA-II subsidies have made a vengeful come back. They include, cash subsidies like in food, fertilizer and export, interest or credit subsidies as in loans given to farmers, industries and students at a lower rate than market rates, tax subsidies like exemption of medical expenses, deducting mortgage interest payment from taxable income, postponing collection of tax arrears, in-kind subsidies like provision of free medical services through government dispensaries, provision of goods to target population, equity subsidies like investment in equity in state enterprises giving low dividends, procurement subsidies as in purchase of food grains at higher than market prices, and regulatory subsidies as in petroleum products. The government of late has introduced new subsidies for its vote banks as in the case of Sachar Committee Report implementation. One estimate is that subsidies at present constitute over four per cent of the GDP. Socialism has in fact become the last refuge of neo-liberal capitalists. [From Internet]

Dr.Pranab Mukherjee's "Political Budget" with a stamp of Sonia Gandhi's mediocrity, jolts Dalal Street's advance, as the Sensex Crashes down, in Arabian Sea:

[Now those who elected this UPA Government on the plea of keeping BJP and its allies out of power, are the culprits, for massacre in Dalal Street. The doors of "Torture Chamber" have just opened and I am sure you will see such wanton tortures of Capital Markets, for some more years...This is the same UPA government which was responsible for the Mumbai carnage and serial bomb blasts in India.

More such punishments for the Dalal Street is on the cards, unless FM seriously thinks of reloading some of the proposals in the bill.

This UPA government was never investor friendly and nor will it be for at least a couple of years. Last few years it only milked the capital markets, giving very little to it. This time, FM disappointed even the Scheduled Castes also, with meagre fund allocation...

I was expecting this kind of "Toota Foota budget", and that is why I ended the Sunday Report yesterday, with the line, "The new finance minister has few options, which he may explore to balance the deficit and expenditure. Overall I am looking for a “Political Budget” from the Finance Minister." The sins of the past, created by P Chidambaram, viz,. the farm loan waiver, fertilizer subsidy, oil bonds have hugely contributed to the fiscal burden of the country and will continue to haunt the UPA Government. Moreover, half hearted stimulus packages and large scale looting of public funds, took the fiscal deficit to astronomical levels."

More spending by the UPA might lead towards higher interest rate regime, pushing us towards deflation (in the economy). This directionless and ill conceived budget will not take us anywhere. I am totally disappointed...

Thus at the end of the day we have A VERY POOR AND UN-INNOVATIVE (Read Vote Bank oriented) BUDGET FROM A PERSON WHO HOLDS DOUBLE MASTERS DEGREE, AND THIS "HOCH-POCH-BUDGET" WILL NOT GET MORE THAN 3 (Three) OUT OF 10 (ten) POINTS FROM ME....

If Dr.Mukherjee has to perform she has to leave the company of this half-illiterate Italian Lady, who hails from very poor background. But how many know the real story.....Moreover we have to decide whether we need a statesman or we need an academically brilliant gentleman as Prime Minister of this great country; who is better suited as a bureaucrat/teacher rather than a politician. The problem is that voters forget the difference between a professor and a statesman while voting...

Dr. Mukherjee, tried to play the political card in view of upcoming elections in some states, rather than for pan India (Mr.Laloo Yadav, shouting in between budget speech, that there is no package for Bihar. But Lolooji, Bihar has BJP-JD govt. and hence you know the reasons for omitting Bihar from the list.

"Bloorrrrr.....Blooorrr....."...Kya Lolooji, thik bola na...??....nahi samjha ka......nahi samjha.!!!....Are baap re bap, up akal se bhi Laloo hai ka"??!! ).

No meaningful relief for the SMEs, though the FM tried to pour funds in the "bottomless agriculture pit", for the fund to be eaten up by the goons of the UPA; by floating various fictitious schemes...Every year this fund flows into Bay of Bengal, Arabian Sea and Indian Ocean--this time also it will not be an exception. However, increased allocation to infrastructure, some minor tinkering in the indirect taxes and removal of FBT could be positive going forward. But no talks on liberalization of FDI norms, or on Disinvestment front points towards a non-reform oriented budget...]

Finance minister Pranab Mukherjee's speech failed to sketch out the new UPA government's larger vision of reform and growth, and thus lost out on a major opportunity to energise the economy's flagging animal spirits. That said, the Budget is not the complete damp squib on growth and reform that the markets' nosedive would have us believe.

In a global scenario where the major economies continue to contract, even if more slowly than before, there is no way the government could have taken the pedal off fiscal expansion, to keep India’s growth momentum going. Thus, the largest ever fiscal deficit, measuring 6.8% of GDP for 2009-10 and a tax burden on the economy that is lower, proportionate to GDP, than in the last fiscal, is a plus, rather than a negative.

In fact, 6.8% of GDP is the Centre’s deficit alone. Take into account the states’ deficit of nearly 4% of GDP and likely, albeit unstated, off-budget borrowings to finance fertiliser and food subsidies, the combined government borrowing requirement would be a little under 12% of GDP. That is a huge piece of fiscal stimulus.

To avert the risk of this huge borrowing requirement pushing up interest rates and choking off growth, the government should proactively announce an intention to raise a sizeable part of it outside the country. That should settle domestic jitters over a liquidity crunch.

An unheralded medium term fiscal policy statement put up on the Finmin web site targets a fiscal deficit of 5.5% of GDP next year and 4% of GDP in the year after. It is surprising that Mr Mukherjee failed to flag this off.

Then there is the infrastructure agenda. The government’s direct spending on roads and railways is slated to go up sharply. Financial engineering is on the cards - take-out finance and refinancing by IIFCL - to ensure that enough credit would be available for infrastructure projects. The government continues to swear by public-private partnership.

For all their flaws, PPP projects are enhancing India’s infrastructure right now. And there are sufficient mechanisms outside the Budget for one to hope that future PPP projects would be better designed and less vulnerable to post-contract abuse.

Many people tend to dismiss the entire inclusion, rural development and empowerment agenda as so much political fluff. On the contrary, this is the core of lasting reform.

To appreciate this, one must have clarity on what constitutes reform. Reform is ultimately about freeing up the creative energies of the people at large. Not just of people who are entrepreneurs and would-be entrepreneurs now. But also of the hundreds of millions of those who currently focus just on subsistence.

Financial sector, tax and administrative reforms are means to this end. True, India has a demographic dividend to reap even with existing levels of output per worker. But imagine the bounty if one billion plus Indians can afford to think beyond subsistence, think creatively. For that to happen, we need not only the kind of inclusive policies being pursued by the government but also complementary political mobilisation to empower people. That, of course, goes beyond the Budget.

The reiterated commitment to stick to the April 1, 2010 deadline for switching over to a Goods and Services Tax is a plus. The Budget asks the citizens to await further action in eight areas, pending reports by expert committee or finalisation of law or action plan: building a natural gas grid, offering relief to farmers who are indebted to moneylenders rather than to banks, operationalising food security, freeing up petroleum product prices, addressing the concerns of private investors, a direct tax code to streamline all direct taxes, a scheme to overhaul fertiliser subsidy and fiscal consolidation, a roadmap to which would be unveiled by the 13th Finance Commission headed by Vijay Kelkar, whose report is due in October. On some of these, we have already had many committees. The implicit dialatoriness disappoints. At the same time, the retention of this reform agenda is reassuring.

On the whole, the Budget marks continuity of slow reform in the right direction, even if it fails to release adrenaline in our market bulls. [With inputs from Internet]