March 15, 2011
School of Business, Coimbatore
A symposium on Union Budget 2011 was organized at the Amrita School of Business, Coimbatore on March 7.
Dr. Thimmaiah, former member of Planning Commission was joined in the discussions by Dr. N. R. Bhanumurthy, Professor of Economics at National Institute of Public Finance and Policy, New Delhi and Dr. M. Manickam, Vice-Chairman of Sakthi Group of Industries.
“The current year’s budget effectively attempts to balance the two conflicting objectives of growth with sustainability,” opined Dr. Thimmaiah.
“The budget has tried to achieve this by providing adequate thrust to the infrastructure sector, especially power, which is a major constraint for growth, at the same time taking measures to strengthen inclusive growth,” he noted.
While commenting on the efforts of the government to bring about inclusive growth in the area of banking he added that the government should provide added thrust to inclusive growth in other areas also.
“There are concerns about the level of budgetary allocation to health care and education sectors and also the level of fiscal deficit,” he stated.
“Though the finance minister is confident about the fact that the fiscal deficit for 2011-12 could be contained at the level of 4.6% of GDP, the chances for crowding out cannot be ruled out.”
Dr. Bhanumurthy, who spoke next, was confident about the country achieving 9% growth. “The policies implemented to enhance competitiveness of the manufacturing sector in India are inadequate, especially given the competition from China,” he said.
Questioning the relevance of the budget process itself, Dr. Manickam said that it is relevant to the extent that it can provide the right kinds of opportunities for productively engaging the poor. He noted the correlation between the increase in the production of soya bean crop in Madhya Pradesh and a reduction in dacoit activities in the state.
After the three individual panelists presented their views, the panel discussed several issues related to FDI, FII, manufacturing vs. services sector, etc. with audience participation.
The panel discussion was anchored by Dr. G. Kalyanaraman, Dean, Amrita School of Business.
“FDI is a strong determinant of growth,” observed Dr. G. Kalyanaraman, citing the experience of other emerging economies and India, where there is a divergence between promises made and realities seen on the FDI front.