Middle Class: Economy Driver of India

Aristotle once said, “A good society is one where the middle class out numbers every one else.” And India is gearing forward to scale this height by 2025. The once upon a time middle class is playing weighing machine for the rest of India.

Children IndiaThe Indian economy has been doing fairly well for the last few years or so, and the most striking characteristic of India today is the explosive growth of the middle class. This middle class was branded as conservative and thrifty a few decades back. However now, India’s middle class is more dynamic, liberal and forms the pillar of a vibrant economy that we have been witnessing lately. This middle class is now playing a definitive role in emergence of India globally, which is full of energy and enthusiasm that is driving the economy towards success and development.

We have always believed that the population has served as the “big” problem for us. It might be true, but there is another aspect to it as well. Although there is no denying that we need to control our population, the youth, which comprises 60 per cent of the total population of the country, can be an asset. Former President, APJ Abdul Kalam once said that large populations created demand for goods and services and was the basis for economic growth. However, we need to give equal oppurtunities to everyone, including the lower strata of the society through good education. A high population creates large markets, which is further advantageous if people are educated. A rise in the level of education gets translated into rise of income. This growth of our middle class has changed our society and politics distinctively. Its worldview is different and if the middle class organises itself in a better way, it has the power to revolutionize the society. Middle class is more conscious about what is right or wrong. They know what their rights are and how to fight for them. Till date, the story has been good, but we cannot be complacent and need to strengthen our middle class.

With the rise in numbers, it is important for us to realise that we (the middle class) have the control of the steering and need to drive our nation forward. We need to develop a better social and civic sense. The middle class was lauded for its action in the Jessica Lal case, Reservations, RTI act but still we respond to only those issues with which we can co-relate ourself. There are thousands of acts of injustice, corruption and unethical behaviour to which, many a time, we become party or beneficiary. We cannot distance ourselves from the range of issues that concern our nation and we must realise that our views, opinions and actions can do wonders. It is equally important to keep the moral and social fabric of the society intact and present a true image of a united India.

The management consultancy firm, McKinsey predicts that India’s middle class will reach 583 million by the year 2025. India will reach Aristotle’s ideal by then, and the middle class will constitute 50 per cent of the total population. With the increase in the size of middle class, India is bound to scale new heights and avenues.

Ramadoss: An Embarrassment for UPA

Ever since Dr Anbumani Ramadoss has taken the charge of the health ministry he has been directly involved in lots of controversies. The recent judgement by the Supreme Court declaring the AIIMS amendment act as a void is yet another setback for the minister. The verdict came after Dr Venugopal challenged his removal as AIIMS Director following an amendment moved by Union Health Minister Ambumani Ramadoss to fix 65 years as the upper age limit for the post.
It is belived that Ramadoss forced parliament to bring amendment in AIIMS Act to remove Dr. Venugopal. Dr Venugopal was removed from AIIMS in 2007. The AIIMS Amendment Act was passed by the Parliament in August 2007. The health minister of this UPA government has done everything wrong as far as medicos are concerned. The battle between medicos and Anbumani Ramadoss started in the year 2006 after the quota agitation and since then Ramadoss is at loggerheads with the autonmous and premeier institute of AIIMS. Anbumani Ramadoss is doing everything to ensure that he remains in some lime light but in doing so, he is maligning the image of AIIMS and health ministry and it is high time that Dr Manmohan Singh takes some stern action against him.
Dr Ramadoss junior has been in the eye of a storm for urging film and sports stars to not endorse soft drinks; for stuffing AIIMS with his cronies; for publicly contesting United Nations figures on AIDS in India; Dr Ramadoss had no time to sign degrees and hence student’s got their certificates of merit late and that too after intervention of court; increasing the tenure of MBBS; and for advocating statutory warnings for smoking on screen. He is targeting Shahrukh Khan and Amitabh Bachchan for various stupid reasons and has just lost his balance somewhere it seems.
The UPA and Congress is trying to put a brave face up but the verdict has certainly showed the dishonest and malafide intentions of the minister. Anbumani Ramadoss has brazenly said that there is no question of his resigning over the SC verdict. The health minister has made AIIMS a playground to play the dirtiest of politics.
But this verdict might start a fresh debate in political arena to clip the wings of the Judiciary in the country. Few of the political parties have already said that judiciary is intervening too much in the working of the parliament. As Ramadoss waits to study the verdict we may see fresh confrontations between Judiciary and Parliament. Politicians argue that laws passed by parliament should be protected from judicial review since MPs are the people’s representatives. But then Supreme Court is the custodian of the Constitution. Any decision to clip the wings of the court may lead to same scenes that we saw in Pakistan after removal of Chief Justice. Whatever be the case the fact remains that Dr Ramadoss is and embarrassment for UPA and should be removed as soon as possible.

The Divisive Policy of RESERVATIONS

Reservation CartoonTHE RECENT Supreme Court verdict on Other Backward Class (OBC) quota in central educational institutes was a fine balancing act despite the enormous amount of pressure being exerted on the judiciary by the government in an attempt to curb the so-called judicial activism without realising that it has a become a necessity, due to complete failure of the government on all fronts.The various bright aspects of the order are:

1) No quota in post graduate courses, though the government is trying its level best to intentionally ignore it

2) Exclusion of creamy layer from the benefits of reservation

3) Review of quota policy every fiver years

But still this verdict will have far reaching consequences on life inside the campus in the coming years as we have already seen in the state owned institutes. Firstly, the campus gets divided into two ’almost equal’ halves. I say ’almost equal’ because many students from reserved category pick up unreserved or open seats or unreserved seats are shifted under reserved categories due to some biased rules like ’ear-marking’. As a result, general category or so-called upper caste students actually comprise of a ’minority’ in the campus and lets not forget there is reservation in jobs and promotion already present, so the faculty is also ’silently’ divided.

Quota based on rational criterias like economic status, rural-urban divide, gender divide, vernacular English divide etc would not have created ’Us’ verses ’Them’ feeling. But quota based solely on caste does create this dangerous divide in the campus. If you visit any campus, by general observation of socio economic status, students coming from OBC quota will tell any neutral observer that they neither require nor deserve benefits of reservation. Yes, there is some consensus that schedule castes and scheduled tribes do deserve quota but even amongst them the creamy layer must be kept out.

The term OBC in our constitution was never other backward caste. It was other backward class. The class could comprise anyone, it could have been a village artisan or a person belonging to economically backward upper caste. The important word in OBC should have been backward and not caste because it is the most cosmetic and divisive criteria to decide backwardness.

As far as current OBCs are concerned, they include Yadavs who were kings 2000 years ago! A Yadav (Yaduvanshi) was worshipped by all caste and classes in India. Jats were also rulers, Patils were village headmen, Patels of Gujarat, who were once agriculturists have come to play a significant role in the world of commerce. Similarly in southern India, Reddy’s, Vokkligas, Lingayats, Chettiyars, Vanniyars, and Ejhavas in Kerala are major beneficiaries of OBC reservations but are not backward by any rational standards like human development index and do not require any help, especially quotas.

In current Parliament, more than 200 Members of Parliament (MPs) are so-called OBCs, 18 chief ministers are from backward communities. It is this political clout that is forcing such divisive votebank politics in the name of ’Mandal commission report’. The blunders in Mandal commission are because of the fact that it was based on cost indexing of 1891 and the census of 1931 when Pakistan, Burma and Bangladesh were parts of British ruled India. Mandal report was a politically motivated report used for potential political gains and had glaring inadequacies in it, as highlighted in the speech given by the late Prime Minister Rajiv Gandhi in Loksabha on September 6, 1990.

The division in the campus and the frustration in the general category or the so-called ’upper caste’ students creeps up when they see sons and daughters of senior government officials, politicians businessmen, doctors, engineers and professors getting the benefits of caste based reservations and along with that 100 per cent waiver of college fees and other benefits like scholarships regardless of economic status. On the contrary, a lower middle class general category student gets no exemption what so ever based on his or her family income and also faces ’reverse discrimination’ when he or she voice their discontent over discriminatory caste based quotas and what about poor or below poverty line upper caste students? Well they never make it to such elite institutions because neither they have money nor caste for their rescue, regardless of their merit. They get used to getting second grade citizens treatment in their own country.

This debate is not about merit; merit is present among all class, caste and religions without discrimination, it’s about equal citizenship, equal opportunity and equal status in our motherland.

And I will never accept a second grade citizen treatment in my own country simply because they prefer to cast me as an ‘upper caste’.

This article is contributed by Dr Gunjan Sharma, Spokesperson, Youth for Equality, Mumbai.
He can be contacted on yfemumbai@gmail.com

Empowering Our Disabled

DisabilityAt least six percent of Indian population is disabled. However, the disabled in our country are neither aware of their fundamental rights nor do they get to exercise them. In fact most, deaf and speech-challenged people do not understand the meaning of this word “rights”. At most, they would know, it means the right direction or left direction. We either view disabled people as victims or exploit their vulnerability. They are still denied of their basic rights to be able to navigate, communicate and right to education.

Often decisions about the disabled community are taken by the government bodies without involving a disabled in the meetings and decisions. Their logic is that what will a audio-speech challenged person contribute to a meeting about meeting challenges of the disabled. This is plain apathy to them. The concept “nothing about us, without us” is unheard by the government.

It’s all about attitude

I read about a story where visually-challenged guy was applying for the job of a lecturer. The insensitive woman at the form counter seemed to be appalled at the thought of a blind person teaching. She discouraged the blind by talking negatively about the whole thing aloud to anyone who would care to listen. She said, “How would he correct the papers? How would he teach?” She was no authority, she was one of us. She was prejudiced and ignorant. We have to put a stop to that attitude.

Continue reading Empowering Our Disabled

Unique Protest in Supreme Court by YFE

A report of what happened when students gathered at the SC lawns to appeal against the way 27% reservation for OBCs is being implemented.

Wondering why the youth brigade didn’t come up with strong reactions immediately after the Supreme Court ruling that gave way to 27 per cent reservation to the OBCs? Well, this could be safely attributed to the proverbial silence before the storm.
On April 25, students did something nobody has ever done before. It was an appeal alright! Yes, again! But the venue wasn’t Jantar Mantar or the India Gate lawns but the main garden of the Supreme Court of India. Yes, this was the first-ever appeal to be held inside the Supreme Court premises in Indian history. Two hundred students had gathered to convey a message to the government – not to dilly-dally on the SC’s terms and to respect the judgment and clear the concept of the ‘creamy layer’.
Are you wondering how did 200 students get inside the SC gate? This was a strategy. Said a student present, “We walked in one after one and started pouring in since early morning. It was easy to walk in and engross ourselves in cups of chai before starting our appeal around 11 am. We had wanted this to be a silent affair but it didn’t turn out to be just that. We were literally plucked from the ground and dragged into police vehicles and then sent off to the Tilak Marg police station.”
The students offered resistance, held hands and sat close in a huddle and the police wasn’t very kind to them. While some students were tugged, others were pulled and dragged, some were lifted off the ground and some were slapped. It wasn’t the best way to deal with them and, as a result, around ten students were hurt, taken to RML and some lost their phones. Once the authorities realised that this was a strategy, Section 144 was applied that barred anybody from entering the SC.
There was a twist in the tale too! After students were sent to the Tilak Marg police station and released a while later, the entire crowd came running back to the Supreme Court. But this time they couldn’t enter the premises and slogans started at the gate. They were again put in police vehicles and taken to the police station a second time. “We are here to make a point,” said another student, adding, “We aren’t here to go back.” And what exactly is that point? “Implement SC’s judgment, please. Make the new list of OBC beneficiaries, keep to the SC’s take on the creamy layer and provide no reservations at the PG levels,” answered Jiten of YFE. Students from JNU, DU, IP University, AIIMS and MAMC were a part of this movement. And what did the students do post being released a second time? “We went to get some clothes. Our clothes were ruined with the amount of manhandling we were subjected to,” informed a student.

Impact of Reservations on Higher Education

The Supreme Court has given its verdict on the 27 per cent reservations and the government is all geared up to implement it from this session only. The much-debated other backward classes (OBC) quota will be implemented at prestigious educational institutions like IITs and IIMs nationwide. Why the reservation card was played by Arjun Singh is altogether a different matter and now let us concentrate on the impact of this extra reservations on higher education in India.

The faculty shortage:
The number of faculty hasn’t increased all that much with the subsequent rise in the number of students over the years, and this is because there’s a huge shortage of quality teachers. Latest survey says that the nation’s seven IITs need about 900 additional faculty members before the next academic session to counteract the shortfall. This survey was done when there was no provision for the OBC quotas. The government has said that the total number of seats belonging to general category wouldn’t come down. But can government tell us from where will they get the teachers? In a scenario where leading tech colleges across America and Britain offer 1:6 faculty student ratio, most IITs just manage to scrape up a 1:12 ratio while struggling to stem attrition and quality faculty. In some of IITs, it is hard to maintain a ratio of 1:14. The same is the story of the medical institutes. We recently saw the strike by medicos in Mumbai following the reduction in post graduate seats for need of the teachers. The seats, which were 1900 in 2001 have been reduced to 450 in the year 2008. The reservation is definitely going to impact on the quality of education.

The infrastructure:
Government announced recently that it’s going to open 10 more IITs and IIMs and the apparent reason is that it wants to promote higher technical education in the country, but won’t opening more IITs and IIMs dilute the brand of these institutions? Already these institutes are facing crunch of faculty members and it is yet to be seen how the government will manage to attract more faculty members for newer institutes. Secondly, do we have requisite infrastructure? The government has no solutions to the problems related to shortage of laboratories, playgrounds, staff, hostels and classrooms in existing institutes. Will they be able to sustain newer institutes or will it turn out as just another plan on paper? Do you remember, the government in 2003 planned to open six all India institute of medical sciences (AIIMS) in the country. The plan has yet not took off. What a pity!

The merit compromise:
The identity of any organization is its quality. Output depends on input of quality. Anything we do should not disturb the quality of input. Why today IIT or IIM or IISC stands so high in quality index, this is because the input quality is extraordinary. The whole idea of reservation, and that too in premier institutes such as IITs and IIMs and a medical institute such as AIIMS would reflect on the quality of graduates that these institutes would deliver. The deserving ones feel left out in the race despite spending a fortune and making all efforts to cope up with the pressure of admissions. We should focus on finding a solution to the issue ‘without diluting excellence’. The students of these institutes have made their country proud and created a brand in the global market. This is because they were few of the best brains in the country and won the fierce competition where there are 10,000 people for one seat. If now we will have 50 per cent seats where the merit is not the sole criteria, then it is bound to impact the ‘merit’ of these institutes. If OBC candidates manage to get admissions into IITs and IIMs, there is no doubt that the OBC candidates will get the skills required to get job offers that make media analysts drool. In the bargain, if some upper caste candidate is deprived of a seat; well, that is social justice in action!

Losing investors:
Many people argue that reserving seats at India’s few merit-based and uncorrupted institutes of higher learning will dilute standards, bring down student morale, and jump-start a brain drain that had just started to reverse. At a time when India is looking towards its youth population to take India to new heights it is of umpteen importance that we provide everyone with the best education possible. Till date, the government has failed miserably to maintain the standards of elite institutes and is definitely looking for private players to invest in the education sector. Many economists are worried about the effect of reservations on India’s competitiveness. Surjit Bhalla, an economist who often advises New Delhi, said in an interview that reservations would become a problem for investors. If there isn’t enough qualified talent available in India, they “will not hesitate to go to China, Vietnam, or even to Bangladesh and Pakistan.”


IITs, AIIMS and IIMs are temples of education that command international respect. Their students represent the face of modern India. Let us not ‘mandalise’ education and vandalise young lives. Perhaps Minister Arjun Singh would do well to recall the words: “Give a man food and he will be grateful yet poor. Give a man the means to earn his food and he will be grateful and financially independent.” He just needs to substitute food with education. We need to focus on the better primary education first. As I would like to sum it up. There are two cliffs – one is the student and the other is quality higher education. In order to bridge these two cliffs, we need quality primary education. But the government, instead of strengthening the bridge, is focusing on one cliff only. If that is the cast, then the bridge is weak and a student will fall into the pit joining the two cliffs.

India today. Its been 60 years. Right??

Pride in being an Indian, nostalgia for what it must have been like in those heady days ahead of August 15th 1947. Looking at sepia-tinted images of Rajpath on the day India achieved freedom, one can imagine the frenzied crowds, the sense of utter joy at being a free nation. We take freedom for granted today. We couldn’t have been quite so bindaas 60 years ago. That perhaps is our greatest achievement, creating a sense of uninhibited freedom among millions (spit where you want, vote for whom you wish!).

Few gave this country a chance of survival 60 years ago. The prevailing wisdom was that India would crack apart into dozens of princely states, that the centre would simply not hold. By contrast, it was expected that Pakistan would be a more homogenous nation,united by religion. As it has turned out, Pakistan has become a nation undermined from within by religious fanaticism and an emasculated middle class. Sure, India too has its crisis points in the form of an imperfect democracy battling poverty, farmer suicides and unemployment, but despite the imperfections, it has been astonishingly resilient.

In the remarkable book, India after Gandhi, historian Ramachandra Guha had once tried to unravel the enigma of India.

“Why does India survive?”, he asked in his final chapter.

His answer, a sense of a shared symbols – cricket, cinema, music – a respect for diversity, and above all, a remarkable constitution that guarantees fundamental rights and enshrines the principle of one man one vote. I think this country owes a huge debt to the framers of the constitution. I cannot think of a more progressive document anywhere in the world, one that respected individual rights above all . We must be blessed that in the 1940s a collection of rare public figures came together to frame the constitution. It might be difficult to imagine this in our polarised times, but in the 1940s, Indians had the sagacity to realise that people of differing ideological persuasions needed to be brought together so that every possible talent could be harnessed. Maybe, we need to read our history books once again to understand the true meaning of freedom, of being an independent nation. Today’s young and restless I fear often have little knowledge or interest in history.

  • How many young Andhraites know of the sacrifice of Potti Sriramalu, the man whose fast unto death led to the formation of the modern Andhra Pradesh, and laid the basis for liguistic states?
  • How many young Maharashtrians know of the Samyukta Maharashtra Movement and the sacrifice of those who fought for their state?
  • Is any young Punjabi interested in reading the biography of Tara Singh?
  • The Forward Bloc may keep the flame of Netaji alive, but do young Bengalis bother to read his life story?

Sadly, we are becoming a country ignorant of our history. We seem more comfortable with the quick fix cinematic idea of Gandhi in Munnabhai, than doing anything to really try and understand the man behind the Mahatma. In the 60th year of Independence, we need to make a pledge: a pledge to try and appreciate our history a little more.Remember that old chestnut:

“Those who forget their history are condemned to repeat it.”

Rachit Chandra

Where is my Right to Education gone?

There is no such Right to Education that is defined in our constitution, but this question raised in my mind when the other day I was reading the newspaper and my eyes fell on an article which said that careers of 171 students pursuing MBBS from Maharashtra was in jeopardy due to the mistake of Director General of Health Services. These students happen to score less than 50 % in Science (physics) and had come to Maharashtra through 15% quota of the all India seats. The Maharashtra CET eligibility requires candidates to have more than 50 % in Science subjects.

Though the country is again in mid of quota war, I want to ask both the pro quota and the Anti quota lobby, where is it written that a person scoring less than 50% in science cannot become a good doctor? The government is playing dirty politics for last 60 years or so and no one has raised any question on it.

The JEE requires 60% cut off in HSC (+2 ), the JMET cut off is 60% in graduation, CAT has a cut off of 50% in graduation, Technical entry scheme has a cut off of 60%, SCRA requires a second a class as minimum condition. I don’t understand is it fair? It is a common knowledge that some boards are easier to score than others. Similar is the case with the universities, yet there is no governing body that ensures that candidates don’t have to lose to others just because they happen to be from a different university where it is hard to score.

Even if assuming that gradation of marks are same across every board and university, It is unfair on the part of the government to allow such eligibility criteria. If a university says that I am a graduate at 40% then I should be treated as one. Why am I shut door for further education? Why am I being denied my right to education? If I am ineligible for pursuing my Post Graduation, just because I don’t have 60% then the passing criteria should be made 60% and not 40%. Why does a university award me a graduate degree when I deserve none? Is it not better to lose a year than being denied education for the rest of my life!

We have a passing percentage at 40%. Making cut offs at 60% essentially means denying a third of the section a chance to compete. We have the world’s largest pool of graduate which essentially means that this policy of the government is shutting doors on a third of the world’s most efficient work force. What right has the government got to do it? The armed forces have no right to cry over the shortage of officers when they themselves turn away one third of the prospective candidates.

Who the hell says that I cannot become a good soldier if I don’t have 60%? If academic excellence itself decides the suitability of a candidate for a job then why are these entrance tests conducted? Is it a mockery of merit? Or is it a money minting ploy? CAT scores are accepted by over 80 colleges in India. If I am ineligible for further education across every country, why do we make hue and cry over “brain drain”? If I have no brains then obviously there can be no “brain drain”! It can only be “donkey drain?”

Why am I made ineligible? Why am I denied my right to compete.? If you recognize the university, then you must also recognize that I am good enough to pursue further courses even if I score 40%. If I am not good enough, as thought by the government and such bodies, what difference will it make if I compete. I will always end up at the bottom of the merit list, but if I am good enough, why am I denied a chance? Academic excellence can be a criteria for selection process but it has to be the last criteria and cannot be the first one.

If the IIM’s say that they do it because they cannot handle the number of candidates, it does not amount to an excuse. You people charge over 1000 INR from each candidate for forms, which at maximum will cost 30 rupees. OMR sheet about 10 rupees, postage of admit cards and score cards 12 rupees ( 10 rupees postage, 2 rupee for the paper ), and about 20 rupees on invigilators per candidate (invigilators will not get more than 1000 rupees for invigilation) . If you cannot handle more candidates even after making a profit of about 900 INR per candidate, and you claim to be the best management college in India, bloody well resign! Burn the IIMs it does not teach you anything. You do not deserve to teach anybody.

If you think I am right even 1% then why don’t we say together, Quota or No Quota I want my Right to Education!!!

The Quota Conundrum!

The Maharashtra government is planning reservations for the economically backward class in education and government jobs. This quota will be in addition to the already existing reservations made on the basis of caste. While the former is a welcome move, the latter causes more harm than good.

NO caste based reservationsMost visionaries are of the view that reservations, if at all made, must be on the basis of economic backwardness and not caste. While caste based reservations invariably aid in garnering votes, they serve no practical purpose. Come to think of it: we have had reservations for SCs, STs and OBCs for many decades now. But has it served to eradicate the social inequality among classes? The “vision” of making caste based reservations for the sole purpose of bringing about social equality is inherently flawed.

For all we know, the people who “get the benefit” of these reservations are invariably in an environment that has people who have made the cut purely on merit, and hard work. So it Is natural then, that the community becomes polarized. Those who have obtained admission into a top school, or made the grade for a top brass job are bound to look at their colleagues with probably the same talent, but having the backing of their caste with a sense of superiority. And mind you, the people who get through because of their “social backwardness” don’t enjoy it either. They’d rather have a level playing field. And moreover, there are plenty of instances where well to do families take unfair advantage of their so called caste, even though they can well afford a lavish lifestyle.

This is where the Maharashtra government plan is a breath of fresh air. Now, the reservations will be made taking into consideration the economic status of the person. This makes much more sense, since everyone would acknowledge equal opportunity for everyone. The basic message is “let everyone have access to education and employment, and let people not miss out merely because they cannot afford it.”

Now, all that needs to be done is to slowly phase out caste based reservations. This will not be simple, since the political babus will put the vote banks before the society at large. However, it is up to the masses to realize the greater good this will do. Anyway, an economically backward individual of a “reserved caste” will still have access to the privileges, but this time purely because he cannot afford it. This will also mean that affluent people will not be able to misuse the quota system.

The entire process will be long and arduous. But, it is the society that stands to benefit from this. Let the small mindedness of individuals not act as stumbling blocks to what looks like, in theory at least, a system that will make everyone happy, reserved or unreserved.

Budget 2008- What to expect?

The Annual Budget is just a month away. Whether it is the poorest of the poor or the richest Billionaires, all of them want a reduction in taxes. With this the last budget of the coalition government, will it be a dream one or will the FM play safe?

With just a month to go for the Annual Budget of 2008-09, it is time to speculate as to what changes can be expected in this edition of the Budget. The Indian economy has been sanguine with GDP growth of 9.25% in2006-07, inflation below the danger mark and sustainable interest rates. But what changes can be expected in this edition. Will there be any measures to counteract the effects of the recession of the US Economy? Will RBI step in to control the gargantuan influx of capital income into the economy. Well, the Finance Minister will have a lot of points to ponder on as he sets out to unleash his last budget of this term.

One thing that we cant ignore is that this will be the last budget of the current coalition Government. The United Progressive Alliance is due for its Lok Sabha elections in 2009 and with the dispute over the Nuclear Deal with the Left, the coalition has been on the Brink of Divorce. Thus, the Finance Minister might not give a budget that could stir up a political storm and bring the ruling government down. He would rather play safe. We can expect a popular budget with the aim of appeasing specifically targeted sections of the Voting Community. Thus vote bank politics could again play a vital role in this year’s Annual Budget.

P. Chidambaram had indicated that there could be a significant revamp in the taxation schemes. The Direct taxes could be reduced from the existing 33.6% inclusive of surcharge to about 25%-30%. Thus, the reduction in the Direct Taxes would come as a sigh of relief to the several individuals as well as corporates who are affected by the Direct Taxes. Reducing the tax rates could also provide an incentive to taxpayers to declare their entire income honestly so that the overall tax collections can be improved. Plus the Surcharge on tax which is paid by Individuals and association of people who have an annual income greater than Rs 10 lakh is expected to reduce. Currently, there is 10 per cent surcharge on personal and corporation income tax which may plummet in this budget. It could come down to as low as 5%. Partnership firms and domestic organisations, whose income is greater than Rs 1 cr will also benefit from this.

The recession of the US Economy has meant that the rupee has appreciated to a great deal. The exporters are feeling the brunt as their profit margins continue to go down. It is predicted that this trend is likely to continue. The RBI is expected to address this issue through its monetary policy and tax cuts in order to reduce the load on the exporters can also be expected. The fiscal deficit is expected to be scaled down to al little above 3% of its GDP. The FRBM Act that is the Fiscal Responsibility and Budget Management is proposed in this Budget. With respect to the fiscal deficits, the FM will also have to ensure that investments do not fall drastically.

It is a known fact that India has failed in having a World Class Infrastructure and has also not succeeded in providing adequate quality services in Education, Healthcare, Water Supply and Sanitation. The challenges of infrastructure will require large amounts of funds. It is believed that in this current eleventh five year plan from 2007 to 2012, we would need to invest almost US$500 billion to meet the infrastructure alone. This current budget could ease regulatory issues in order to facilitate building up of a World Class Infrastructure.

Lets just hope that Budget 2008 turns out to be the least taxing not just for the Finance Minister but also for the billion plus citizens of India.