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ET Online Poll: Fix the fisc, bridge trust deficit or go for $5 trillion? Difficult Budget choices await Nirmala Sitharaman

How much manouevring space does FM Sitharaman really have, now that push has come to shove?

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Last Updated: Jan 29, 2020, 01.46 PM IST
ET Online Poll: Fix the fisc, bridge trust deficit or go for $5 trillion? Difficult Budget choices await Nirmala Sitharaman
How much manouevring space does Nirmala Sitharaman really have, now that push has come to shove?
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As February 1 draws near, hope and fear make for a complex interplay in a country caught in the worst downturn in recent memory.

Will the Finance minister deliver? Given the economy's current predicament, Nirmala Sitharaman appears to have little choice but to cast aside the tried-and-tested and go for something remarkable. But what chances has she of jumpstarting the economy at a time when all the chips are down? How much manouevring space does she really have, now that push has come to shove?

This raises an assortment of related questions, some of them without any clear answers. ET.com collated 10 of the most relevant ones and presented them to its readers with the hope to find out how some of India's best-informed followers of business news view the situation. More than 10,000 readers responded to our Budget survey, and while many of the responses corroborated long-confirmed patterns, a few stood out for their sheer bluntness.

Among the themes the survey covered, the most dominant ones were: How India got caught in this mess, the options Sitharaman has, the GDP reality check, and Budget 2020 as a cure-all. Here is what we discovered over the past one week.

Sitharaman's choices
The first question was about what kind of a master stroke may be required on Sitharaman's part if the current bleak spell of the economy were to be broken.

Almost 54% of all those surveyed think that a cut in personal income tax could be the big fix the Finance minister was looking for. As much as a third of the respondents to a related question (the biggest dampener under Modi 2.0) underlined the general discontent over the delay in a tax cut/slab rejig for the common man.

ET Online

About 36% of participants said that a fix for the job crisis was the one move that would make this Budget a super hit. Some 8% backed a divestment policy overhaul which the govt is counting on for a change in its fortunes. There were very few takers for farm freebies, a finding that appears to highlight the diminishing importance of the agri sector in India's mindscape.

Many of the respondents had a loaded message to Sitharaman on what they thought should be this Budget's main focus. While over 37% said Budget 2020 should go all out on 'growth at any cost', an even bigger chunk (40%) thought that the first thing on the Finance minister's mind this year should be 'setting realistic goals', so that the Budget doesn't flatter to deceive.

How India got caught in this mess
In what may sound like a big jarring note to those who go by the current dominant political-economic narrative, more than half of the participants think it is wrong priorities that brought India to this pass.

A case of misplaced priorities is the biggest factor holding the economy back during Prime Minister Modi's second stint, as many as 52% people said. Well over a fifth of the respondents blamed it on the global trade turmoil, while over 17% thought India needed to get rid of its fiscal deficit phobia.

ET Online

The delay in cutting personal income tax makes an appearance here again. Almost 39% of the people think that no cut so far in income tax has been the biggest dampener under Modi Govt 2.0.

About 29% respondents thought the protracted delay in streamlining GST has been the one big dud that has held back progress. Over 20% called the government out on the lack of urgency to sell of sick PSUs. More than 18% people were unhappy over the fact that government sops were only being afforded to low-income groups.

A GDP reality check
What are the odds — for and against — of India hitting the $5-trillion goal within the 5-year time frame that Modi govt has set itself?

On this question, those who took a measured/conditional stance were far bigger in number than those who put forward an outright yes/no view. Over 40% of them thought $5-trillion was eventually possible, but it would not come within 5 years. More than 38% said it wasn't going to be possible unless radical reforms were brought in.


As many as 12.4% rejected it outright, calling it a 'pipe dream'. Only 9.2% said it was 'highly likely'.

The view that India should accept 5% growth as the new normal has been doing the rounds for some time. But not even 12% people in the survey believed that India's heady days were really over. More than 29% said the economy had more steam left, while 22% of them gave no specific answer as they thought it was too early to tell.

The largest group comprised those who held that everything about GDP, from here on, would depend on the reform trajectory the govt took. In other words, the more radical the reforms, the better.

The backers of radical change also called the shots with regard to another related question in the survey: Is there any hope left for a quick turnaround of the economy? An overwhelming 57% of the people thought a quick turnaround was possible, but consequent upon whether or not radical reforms were set in motion.

This Budget, as a cure-all
Many (about a fourth) who thought a quick turnaround was not out of the question said that Budget 2020 must aim to be some kind of a cure-all — that this Budget holds the key to where India goes from here.

Although not many believed that all hopes were gone, they also clearly told the FM what the economy needs at this point. More than 46% respondents said Sitharaman's firefight must begin at the jobs front. An infrastructure revamp found more than 24% backers. At just over 11%, exports — a key route to becoming a trade superpower — had surprisingly few takers.


The matter of the tax cut takes centrestage here again, underlining itself as the prime demand on people's minds. According to well over a third (38.5%) of all participants, the best way for Budget 2020 to be a cure-all is to get a handle on deficit by broadening the tax base via a slab rejig. Also, two other options for reining in deficit — sell off more PSUs (backed by 24% respondents) and reduce subsidy outgo (about 30%) — could give this Budget more firepower, making it a better cure-all, they seem to think.

One of the key findings pertained to the issue of trust deficit, which a substantial number of respondents (15.6%) saw as being at the heart of many of India's recent travails, and which many analysts say must be bridged urgently.

The last question in the survey sought to find out what people thought was the one thing that Nirmala Sitharaman must not do.

In keeping with the general mood of a nation caught in the worst downturn in recent memory, the responses mirrored a complex interplay of hope and fear — over 28% hoped there would be no more dilly-dallying on sick public companies, 26.2% feared the prospect of more sops being given to corporates, 23% wished the govt would not hand out any more farm freebies, and 22.3% took issue with any easing of the fiscal deficit target.

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