A mouth watering promise.

In a meeting to welcome the same old faces after the so called cabinet reshuffle our most revered Finance Minister is supposed to have confessed that the economy is in dire straits and the only way to avoid a rating downgrade to junk status is to bring down the fiscal deficit. TOI, 3 November. Our most revered Prime Minister kicked off proceedings by saying," Of particular concern is the fiscal deficit, which is too high and acts as a deterrent for domestic and foreign investment. These issues have a rippling effect across the economy." Oh boy! After 8 years of rule by the Congress, led by the World Famous Economist, the only things that are rippling are fiscal deficit, double digit inflation and falling growth rate. The Finance Minister made a strong pitch for attracting Foreign Direct and Institutional Investment. " Foreign investment is not an option, but an absolute necessity." True, but how? His predecessor, who is now swanking about as the President, brought in the General Anti Avoidance Rules which sought to tax corporate deals retrospectively going back to 1960. The Supreme Court has cancelled 2G licenses, 122 in all, because of corruption and he is going to auction them again. Foreign companies and governments naturally see this as paying twice for the same license, which is grossly unfair, when they were not responsible for the initial corruption. The man responsible, A Raja is happily back in parliament. The Finance Minister also asked for aggressive fiscal consolidation through controlling expenditure, especially subsidies, and by raising more resources through disinvestment in the remaining 5 months of the financial year. What a joke! He is the man who wasted trillions in 2008 when he increased civil service salaries by 80%, forgave all bank loans to farmers and started the MNREGA scheme which pays villagers to do nothing, to win the elections in 2009. Reducing subsidies will increase prices which are rising everyday because of inflation and extortionate taxes. People are having to reduce expenditure which is impacting growth. He wants to raise Rs 300 billion through disinvestment, or sale of shares of public sector companies. The last such attempt to sell shares in the oil company, ONGC was a big flop and the government forced LIC to buy up over 90% of shares with the life insurance money of the public. He has promised a " good budget " next year if all goes according to plan. This is terrifying because we do not know what diabolical schemes he has in mind to bribe the electorate like he did last time. The Congress is bent on passing the Food Security Bill which promises cheap food to 70% of the population, which will cost Rs 1 trillion, and free cell phones which will add another Rs 70 billion. Junk grade is nothing. A total collapse awaits us.