Ravi Ramamurti, Professor of International Business and Strategy and Director, Center for Emerging Markets at NortheasternUniversity, Boston, Massachusetts, commenting on the Budget said, “The Budget was bound to disappoint, given how high our expectations were.”
He said that it has few bold strokes. The government was boxed in politically, by the impending state elections, and financially, by the momentum of the previous government’s commitments.
Ramamurti said, “I don’t think lack of time to prepare the budget was a problem. Even if Jaitley had two more months, he would still be boxed in politically and financially.”
Sharing his views on FDI in defence that will have Rs 2.29 trillion in 2014–15, Ramamurti said that there are overtures to foreign companies that may draw in more FDI. “Its unfortunate that India has to spend so much on defence and that we have to look at defence to bring in more FDI. I’d rather want India to get more FDI in low– or mid-tech manufacturing, where China’s declining competiveness could be our windfall, and many more jobs could be created quickly.”
He added that the best way to attract more FDI is to restore India’s growth to 7–8 per cent as the FM has proposed. A country of India’s size and complexity cannot be turned around by a single Budget. But I am confident that over time the Modi government will fix structural problems in the budget. Faster growth will increase government revenues and make it easier to cut expenses, such as subsidies, or fix labour laws, he explained.