The Economist - USA (2021-01-30)

The EconomistJanuary 30th 2021 Asia 31

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Banyan Hard to account for

A

mid theclamour of Indian politics,

the yearly presentation of the na-

tional budget is an oddly solemn rite. By

tradition the finance minister serves

sweets to staff when the tome is printed.

After the descent from Delhi’s Raisina

Hill, the seat of government, to the circu-

lar parliament building at its foot comes

the stock photo on the steps of the legis-

lature, proudly gripping the ministerial

briefcase—at least, until Nirmala Sith-

araman, the current minister, pointedly

dropped this “colonial” relic for a homely

cloth-bound folder.

The ministerial speech itself follows

worn protocol, too, with the minister’s

sweeping overview followed by an ite-

mised account of planned spending. The

delivery can be gruelling. After a record-

breaking address of 161 minutes last year,

Ms Sitharaman felt faint and had to stop

without concluding. Her dogged enu-

meration of government projects and

programmes prompted one journalist to

quip that at least her budget was stim-

ulating demand for coffee.

Yet the stately tedium of the occasion

disguises toil, anguish and considerable

suspense. The stakes for Ms Sitharaman

this year are particularly high. Scheduled

for February 1st, her budget speech falls

in the midst not just of a pandemic, but

also the deepest economic slump on

record and, more immediately, a siege of

the capital by angry farmers. Indeed the

farmers, having briefly occupied the

city’s Red Fort on January 26th before

being shooed away by police, had also

threatened to mark Budget Day with a

march on parliament. (They called off the

march this week in response to the storm

of criticism and the massing of security

services prompted by the assault on the

Red Fort.) Their interest in the budget

itself is minimal; the invading farmers

simply want the government to scrap a trio

of agricultural reforms that would in-

crease their exposure to market forces.

There is keen interest in the actual

numbers from other quarters, of course. As

quarrelsome as the buzzards, crows and

parakeets in Delhi parks, India’s econo-

mists are wrangling more noisily than

usual about what the finance minister

should do. Spend more and damn the

deficit, say some. No, stay the prudent

course, say those who reckon it a good

thing that this government, despite big

talk of boosting the economy as it began to

falter last year, has in fact largely kept its

powder dry. There is ammunition for every

argument. Side-by-side on the same page

of a newspaper, one story carries upbeat

news that the imfexpects India’s economy

to grow by 11.5% this year, while another

states that a leading business lobby pre-

dicts a contraction of 8% in the current

financial year, ending in March. Yes, pov-

erty, joblessness and malnutrition have

surged, but so have corporate profits and

stock prices, to record heights.

This year marks the 30th anniversary of

a reforming budget that yanked a social-

ist India onto a faster growth track. Since

then the momentum of change has

slowed and even, in some respects,

reversed as the government of Narendra

Modi reverts to older ideas of protection-

ism and state control. Many would like to

see the reforms accelerate again. With

revenues down, spending sorely needed

and asset prices high, one obvious way to

achieve this would be to stop dithering

over privatisation. The government

could raise some $50bn, enough to fund

two to three years of spending on health

and education at current levels, simply

by shrinking its holdings in a handful of

state-owned firms to around 25%, reckon

Shashwat Alok, Aditya Kuvalekar and

Akhil Agarwal, a trio of economists.

But then again, this year also marks

the 161st anniversary of India’s first-ever

budget speech. It was delivered in 1860 in

Calcutta, as Kolkata was then known, by

James Wilson, a Scottish businessman,

banker and politician who, 17 years earli-

er in London, happened to have founded

The Economist. The British colonial au-

thorities had appointed him to restore

order to their shambolic finances. The

hard work took a toll. Just eight months

after arriving he died, as his tombstone

in Kolkata explains, “from the combined

effects of climate, anxiety and labour”.

Before he succumbed, Wilson ex-

pressed withering criticism of the ad-

ministrative ineptitude and vacillation

of the British regime: “The sacrificing

consequences of procrastination and

shirking responsibility and the tendency

to get rid of difficulties by compromise

or delays are fatal elements in the charac-

ter of the Government of India.” Even

though India has long since rid itself of

imperious colonialists, it seems not to

have expunged all their vices.

India’s budgets are becoming ever less reformist

pin, as Joaquín Guzmán, a Mexican cartel

boss nicknamed El Chapo.

Yet until Reuters, a news agency, pub-

lished a report on him in 2019, he was virtu-

ally unknown to the wider public. A search

on Baidu, a Chinese internet service, re-

veals not a single mention of him in Chi-

nese-language sources before his arrest.

Even though he is said to have been pro-

tected by a squad of Thai kickboxers, he

kept a remarkably low profile.

Mr Tse was arrested as a result of an in-

vestigation codenamed Operation Kungur

which involved some 20 law-enforcement

agencies, led by the Australian Federal Po-

lice. It is not his first brush with the law: in

1998 he was convicted in New York of con-

spiracy to import heroin. By 2006 he was

out of jail and soon, say law-enforcement

agents, returned to trafficking.

The Company is said to make its meth-

amphetamines in big production facilities

in the Golden Triangle, where Laos, Myan-

mar and Thailand meet, and especially in

Shan state in eastern Myanmar. From there

they are smuggled into Thailand, Bangla-

desh and farther afield. The syndicate was

thought to have been the source of 1.2

tonnes of methamphetamines found at

Geraldton on the west coast of Australia in

2017—the biggest-ever seizure of the drug

in Australia. The Company distributes the

drug both as tablets known as ya ba(“mad

medicine” in Thai) and as crystal meth,

which is usually smoked. Such is their

mark-up (as much as 30,000% in Japan)

that traffickers can afford to lose several

consignments and still make vast profits.

Mr Tse himself is said to have become so

rich that he once blithely walked away

from the gambling tables at a casino in Ma-

cau after losing $66m in a single night. 7