ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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1990-91 Budget and Some Issues of Macroeconomic Policy

1990-91 Budget and Some Issues of Macroeconomic Policy Ajit K Ghose A second look at the analytical propositions guiding the 1990-91 budget proposals against alternative theoretical schemes of the relationship among deficit financing, inflation and trade balance THIS note does not attempt to provide an assessment of the fiscal measures proposed in the union budget for 1990-91. Several such assessments are already available and there is not much that can be added. The purpose of this note is to raise some questions about the analytical propositions which appear to have guided the formulation of the budget proposals. These propositions are about the short-run functioning as well as the requirements of long-run development of the Indian economy. The plausibility of these propositions is by no means established. They, therefore, need to be discussed and scrutinised not so much because the inadequacies of the present budget arc thereby highlighted as because the development of a sound analytical basis for future budgets is clearly desirable. It is in this context that this note discusses both the ideas implicit in the budget and some alternative ideas.

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