Why Budgets & Monetary Policy Should Be Converted Into Proper Festivals 

Do budgets matter? Thus far, one has always believed that they don’t, for almost none of the revenue or expenditure projections ever come true. Then why have budgets, and the media circuses surrounding them?

Does monetary policy matter? Reserve Bank Governors (or, for that matter, US Fed or ECB chairs) like to believe that what they do with interest rates somehow matters to the whole world. They spend precious hours fretting about caging the inflation genie, when one good monsoon and a global commodities crash settles the issue even without their interventions.

But I have now seen the light. Budgets do matter; monetary policies even more, for we have six of them in a year. The problem is we have taken the wrong lens to view budgets and monetary policies; we have treated them as economic documents and events related to the real and financial worlds, when they are something else.

They are festivals.

Indians are, if anything, lovers of festivals. We barely saw off Ganesh Chaturthi and immersions last month and we are immersed again in Navratri, Durga Puja and Dussehra. A bit down the line we will have Kali Puja and later Christmas.

It is not as if we don’t have the paraphernalia of festivals during budgets. Armies of analysts are assembled to read the holy text of the budget and deliver their own pravachans on TV. TV crews follow the RBI Governor like hysterical crowds at a Jagannath Rath Yatra in Puri.

But there is something missing: devotional fervour.

Consider the deracinated way in which we treat budgets – like something to be dissected in a media lab. We uncultured louts in the media and monetary policy hacks have failed to worship budgets and monetary policies with the faith they deserve. Little wonder most budgets disappoint, and monetary policies leave people thinking the Governor is a retard.

But what if we looked at the Union budget like we do an Onam or Pongal or Bihu or Baishakhi or Diwali? Would we ever be disappointed with it? Finance ministers are mere mortals trying to grapple with the uncertainties of unfathomable global headwinds or domestic tailwinds. When no one can predict whether a dream budget will turn a nightmare before the year is out (as P Chidambaram found out the hard way in 1997-98), why pretend that finance ministers have all the answers? Leave it to God, fate, karma.

On the other hand, consider the fun we would have converting budgets into festivals. Instead of criticising the government for anti-poor policies, the opposition would be busy distributing sweets with compliments from Sonia Gandhi instead of excorating the finance minister. Once we elevate budgets to holy festivals, FMs will be venerated, not hauled over the coals for minor transgressions like missing fiscal deficit targets or slashing education budgets. Reserve Bank Governors will become the high priests of money, the male versions (till we get a female Governor) of Goddess Lakshmi. Accountants will do pujas with little red khatas. No one will complain about Governors being hawks or doves, about being behind the curve on inflation or ahead of it. They will be worshipped like gods. Full stop.

However, FMs and Governors too ought to adopt the festive spirit and appropriate reverent attitudes to monetary policy. Currently, whenever they are forced to raise rates or can’t reduce rates, finance ministers have smoke coming out of their ears and menacingly threaten to “walk alone” (Governors know that when FMs “walk alone” they carry a club). But what if Governors, before presenting a tough monetary policy, were to visit Tirupati and inform the FM of the day that Lord Balaji had whispered a rate hike in their ears, and that they cannot go against His wishes? No finance minister will want to take the Lord of Tirupati head-on. It would help if Governors also did a tonsure to make things convincing. Both the current and previous Governors were generously endowed on the hair quotient. Only Duvvuri Subbarao would have had a problem convincing P Chidambaram that he had gone to Tirupati for a tonsure, nature having done that in advance.

Now consider budgets. The next budget will be presented in early February or late January, but this is not the revolution it is claimed to be. To render budgets truly holy and beyond question, we should consult astrologers and fix auspicious dates, and preferably follow the lunar calendar. The last thing we should do is present it during Rahu Kalam. Little wonder some budgets go horribly wrong. If Ganesh Chaturthi dates can change from year to year, why not budget dates?

Ideally, finance ministers should fast a day before the budget, and in the week before visit Badrinath and Kedarnath, not to speak of taking a holy dip at Triveni Sangam before presenting their budgets. A dip in Delhi’s Yamuna is not recommended. Muslim finance ministers, when we have one, should consider taking the Umrah and Christians a trip to Velankanni before handling budget documents.

As for budget deficits, instead of taking the help of the Vijay Kelkars and NK Singhs to draw up newer and newer roadmaps, finance ministers should consider using experienced tarot card readers and pick the right number every year. RBI Governors should do the same, where one card can read 25 bps cut, another 50 bps, one no-change, one CRR cut, and one nothing. The tarot reader can pick one and hand it to the Governor, and he can read his speech in peace, knowing he did his best.

A more imaginative FM or Governor can also add the Bollywood touch. Why not make an entry with 18 gyrating dancers swinging to disco numbers? If they think this is sacrilege for a holy occasion, they could try avant garde bhajans. A budget or monetary policy presented without this backdrop, complete with smoking agarbattis in the background and a coconut ready for detonation, cannot carry the same conviction with the media masses as they should.

The budget speech itself could become a discourse on thrift and healthy living, with the annual accounts and expenditure statements being left in parliament’s library for those with more masochistic inclinations.

When budgets and monetary policies are delinked from economics and converted to quasi-religious festivals, they will develop a life of their own in keeping with this country’s soul. A side benefit: no one will criticise it. And the media will love it. How much more interesting will it be to speculate on whether a Naga sadhu cursed the FM while bathing in the Ganga or whether a black cat crossed the Governor’s path on his way to the RBI headquarters on monetary policy date.

How much more money could have been collected through the Income Disclosure Scheme (which closed on 30 September with Rs 65,000 crore of declarations) if it had been presented as Lord Balaji’s hundi rather than a mere declaration of past crookery with a 45 per cent debit note? The rich are happy to leave gold, diamonds and bundles of black money in Tirupati’s vast treasury, but book a flight to Cayman Islands when they see the taxman waiting at the kerb. Maybe, the threat of incurring the wrath of Lord Balaji would have coaxed more money out of the tax-evader than the club of the taxman.

The point is this: when budgets are converted into festivals, they take on a life of their own, allowing mere mortal FMs to transcend the normal constraints of revenues and expenses. The FM could read the Portuguese minister’s budget speech (as our external affairs minister did some years ago at the UN) and no one will hold it against him. The Governor can read his monetary policy in Sanskrit and everyone will ooh and aah, barring the uncultured Left, who will see this as saffronisation of monetary policy.

When budgets and monetary policies become holy, it is the devotion that matters, not its content. Nirvana is close at hand.