FM still has 85 promises to keep

Subhomoy Bhattacharjee

In his last four budgets between 1998-99 and 2001-02, Finance Minister Yashwant Sinha made a whopping 196 promises of which 85 have yet to see the light of day. These do not involve any specific tax related proposals.

Many of these are repeat promises extended from one budget to another. However, since the government would take credit for the number of budget promises made and fulfilled, we have included them as separate promises every time they were announced.

Naturally then, the action taken report on every budget has dubbed any move forward on a budget promise as a fulfilment. But the record of actual action taken has been below par in over 43 per cent of the promises. Of course, the reasons for the unfulfilled promises do not lie with the finance minister alone.

For analysis, we have looked at the record of actual implementation of the promise and whether they have had any measurable impact on the sector concerned, and so the maximum budgetpromises made in 2001-02 (61) have been left out like those which have more than a year deadline.

So even as the government promised doubling foreign direct investment in two years in 1998-99 and also said it would reduce the number of centrally sponsored schemes sharply, the performance has not been noteworthy. In many cases like securitisation of state electricity board dues again promised in 1998-99, things have not yet been concretised.

Beyond the numbers, some of the promises reveal that they have been more of a reaction to the events of the year instead of a well thought out policy. For instance on capital markets, Sinha said he will strengthen Sebi mechanism to protect small investors from broker default (1998-99), and next year (1999-2000) promised a joint mechanism between Sebi and the department of company affairs for action against promoters.

There is no mention of Sebi in the next two budgets. Instead, the government planned a legislation to control malafide non-banking financial companies (2000-01) when the row over vanishing plantation companies erupted.

However, the government's record in implementing capital market promises has been better than those meant for the industry. A close look shows it has promised more to industry than it could actually deliver. This includes promises to levy user charges, review the drug policy, create a restructuring fund for retrenched labour and restructuring plans for Indian Airlines besides divestment targets that have been consistently missed.

But the record for the longest running budget promise in these four years is the one to integrate the watershed development programmes. Following it close is the promise to form 200,000 self help groups in five years and the promise to raise the allocation for education to 6 per cent of the gross domestic product.

And there are promises that the finance minister will like to forget, like simplifying the procedures for giving sovereign guarantee for power projects (1998-99).

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