Union Budget for 1990-91

Pulapre Balakrishnan From a short-term perspective, notably with respect to resource mobilisation, the Union Budget for 1990-91 is somewhat disappointing. The increases over the previous budget in market borrowings of the central government and of subsidies, not to mention the increase in defence spending, hardly reverse the trends initiated by the previous regime. Nor is there reason to believe that the inflation rate is going to be lower despite the reduction in the estimated deficit. However, the budget contains the germ of sensible thinking on some longer term issues concerning the relationship between targets and instruments. Here the finance minister has shown himself to be pragmatic and refreshingly non-doctrinaire. But he cannot hope to maintain the present stance towards agriculture next time round.