Missed opportunities

The Prime Minister, Manmohan Singh, said more than once at his press conference last Saturday that his government has been in office for only 100 days. In doing so, he was seeking time to show results on many fronts, and no one will grudge him that.

However, it is also important to understand whether more could have been done in these 100 plus days, lest other opportunities are missed in the coming days and weeks. And a good way to address the question is to look at the three good opportunities the new government has had to take reform forward.

The first came with the railway budget; the second with the general Budget; and the third with the trade policy for 2004-09, announced last week. It is interesting to see how little has been achieved through all three.

It might be argued that nothing much could have been expected from a populist like Lalu Prasad, who should never have been given the charge of critical infrastructure like the railways.

He did absolutely nothing of any consequence in terms of budget proposals, and wasted a chance to set a new direction for the railways, as a modern transportation system that is run on healthy financial principles. Instead of increasing user charges, Mr Prasad said, he would borrow from the World Bank.

Where the Union Budget was concerned, up to a point the finance minister was right when he said that he didn't have much time to make changes.

But it is also true that when it came to taxation measures, the sins of commission in the Budget outweighed any sins of omission: the introduction of a transactions tax that his own officials had advised him against, and the reversal of the tax reforms pertaining to the textile industry (under pressure from the DMK), were the two obvious examples.

Others abound, like the counter-productive way in which some industries were made zero-tax. On the expenditure side, the minister pretended to be doing more than he was. The only thing that can be said in defence of the Budget is that the revenue deficit has been reduced""but for this to actually happen, the ambitious revenue numbers will have to materialise.

As for the foreign trade policy, Kamal Nath is a clever politician but his grasp of economics and international trade can do with improvement. His trade policy is straight from the 1970s and 1980s, relying not on competition to foster competitiveness but on subsidies.

Also, he seems to have indulged in some rather generous giveaways, which are difficult to justify. The commerce minister should have announced, instead, that he is abolishing the trade policy as an anachronism that no country with an open trading system has, and that he would henceforth focus on interceding with his ministerial colleagues on the issues that can help increase India's share of world trade.

Overall, therefore, while the Prime Minister is right in saying that 100 days are too early to form definitive judgements, it is necessary to point out that there have already been some missed opportunities.