Fiscal prudence still matters

Govt will need to spend more, but should credibly commit through institutional reform to future transparency and prudence

There is no question that the Narendra Modi-led National Democratic Alliance government has, in its time in power since 2014, been relatively careful about visibly appearing to meet fiscal targets. In other words, it has not overspent grievously. That does not mean that there are no concerns. First, the quality of the expenditure was not up to par, given that it prioritised the public sector at the expense of private investment. Second, the Union government has constantly sought to extend its control and share of revenue at the expense of the states. And, third, I say “appearing to meet fiscal