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October 25, 1999
Economists dissect the government's 100 Days Mantra
Neena Haridas in New Delhi
In fine, the Indian economy is all set to get a face-lift. In 100 days. The government machinery is working overtime like it were apocalypse. In Finance Minister Yashwant Sinha's own words: "The government is in a hurry. A whole lot of policy initiatives are in the offing because the government is looking at the entire spectrum of economic life in the country."
Why is the government in a hurry? Economist and the Bharatiya Janata Party ideologue Jagdish Shettigar says, "It is not that the government is in a hurry. There are a lot of pressing problems that our economy is facing. To begin with, there is the fiscal deficit problem which cannot be ignored at all. Hence, a lot of things need to be put in place before the fiscal year comes to an end. That is the reason many ministries have taken up their agenda for the next 100 days."
The fiscal deficit at the end of August was rising by 26.2 per cent as compared to the targeted rate of 6.9 per cent. This is expected because expenditure was growing at 17 per cent as compared to the target rate of 12.2 per cent and tax revenues (at the end of September) were rising at 13.3 per cent as compared to the required rate of 18.9 per cent.
Shettigar adds: "Besides, when a party comes to power with a majority, there is the danger of it getting complacent and forgetting its promises. Now, this government does not wish to be identified as a coalition that forgets its promises once it comes to power. The National Democratic Alliance has made a commitment to the people and wishes to keep the promises."
Media reports have revealed how the government machinery was working towards the 100 days agenda even before the election results were announced and the permutations of power came to the fore. Apparently, the Yojna Bhawan, the seat of the Planning Commission, was abuzz with action in mid-September itself. Deputy Chairman KC Pant and his team worked overtime to draw up an agenda, even as the various ministries were asked to draw up a list of 'milestones to be achieved in the first 100 days.'
The plans are on paper, the agenda has been drafted and presented to Prime Minister Vajpayee. How much of the talk will be walked? A section of economists is apprehensive. "Well, it's good to have a government that comes into action from Day One. And rightly so because it was hardly a new government. But how much of all this talk will translate into action needs to be seen."
A section of sceptics feels that the government's overemphasis on the 100-days economic agenda is an eyewash to take attention off its non-performance in the social sector.
A sources in the Federation of Indian Chambers of Commerce and Industry or FICCI says, "We think the government's initiative shows the urgency of the issues at hand. First of all, one must not take this 100 days deadline as sacrosanct -- it is more of a benchmark that the government has come up with in consultation with industry. It is symbolic of the urgency with which we must look at the economic problems.
"And we really don't believe that the agenda is an eyewash to take attention off social problems. You see, the social problems have been here for a long time and need long-term solutions and they can be put in place only if the economy is stabilised. It's a two-way process and it's important to put the economy back on track."
What if the government fails to meet its targets in 100 days? There is little worry about this as most economists feel that it is important to make a beginning. Dr Rakesh Mohan, director, National Council for Applied Economics, says, "It is normal for a new government to put in a 100-days agenda immediately after taking over because they want to give the impression that they are performance-oriented. There is a value to the statement and it makes a lot of sense.
"But it may not necessarily be a do-or-die deadline because a government comes to power with five years in mind. But as long as the government is committed to the policies that have been announced, the economy can be put back on track."
Others point out that there are just five months to go for the budget, and it may not belong before the results of the fast-track economic agenda will be known.
The NDA government and the economy
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