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Journalism of Courage
The Indian finance ministry team has run an unusual race to come out with a globally outstanding score card in Budget 2013-14.
These countries have managed a unique achievement being able to compress their fiscal balance at the pace at which India has managed it for the year 2012-13,according to data from the International Monetary Fund IMF.
Global data from 2006 show governments in countries outside the OPEC bloc oil producing nations consider their job well done if they manage to reduce their deficit by an average of 0.6 percentage points of their respective gross domestic product GDP.
Compared to that,finance minister P Chidambarams team has touched nearly one percent age point deficit reduction score this time.
For instance in Asia the pace of improvement in fiscal balance has averaged 0.5 per cent since 2009 when the deficits peaked at 2.8 per cent of GDP.
Among the advanced bloc among European nations the pace of improvement has been the same,again since 2009 when it had peaked at 3.9 per cent . Only in 2011 did the bloc of the triple A rated economies make a huge effort and slash their deficit by 1.5 per cent.
The same picture is evident in the G-20 bloc too that includes the United States,Japan and Canada.
The best performance of the bloc has been a 1.3 percentage point improvement in their fiscal balance again in the year in the immediate aftermath of the debt crisis in the continent.
The chart alongside,shows individual score cards of the countries from emerging economies and the cross section of developed nations for the year when their fiscal effort has been the best since the global crisis of 2008.
It is evident that except for Malaysia and Russia,the two commodity rich countries,India has done better than everyone else.
The same pattern is visible for the top economies too. A pace of reduction in fiscal deficit of one percentage point and more is a game changer for all these economies.
The IMF chart shows that economies which have reached this pace of fiscal correction usually find their other indicators like debt and combined state and federal balance too looking up rather spectacularly.
