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Saturday, 10 February 2018

The Hindu Editorial : Are Fiscal Risks Increasing ?

mahendra Guru
The Hindu Editorial : Testing The Diagnosis

Title: Are Fiscal Risks Increasing?
(The fiscal deficit rule has been honored more in breach than in observance. We need better discipline)

After the enactment of the Fiscal Responsibility and Budget Management (FRBM) Act in 2003 and the related FRBM Rules in 2004, the target fiscal deficit to GDP ratio of 3% for the Union government was achieved only once, in 2007-08, when it was 2.5%. That achievement has yet to be emulated again. The FRBM Act was amended twice, in 2012 and 2015. The revisions in 2015 shifted the date for achieving the 3% target to 2017-18.

• Budget 2018-19 has proposed amending the FRBM Act again, which will shift the target of 3% fiscal deficit-GDP ratio to end-March 2021. No target has been set for revenue deficit.

• The average rate or margin by which different governments have reduced the fiscal and revenue deficits relative to GDP has been quite low.

2009-10 to 2013-14 was 0.3 percentage points per year in the first period and 2014-15 to 2018-19 was 0.2 percentage points per year for the second period.

• The current Budget has retained the fiscal deficit at 3.5% of GDP, missing the budgeted target of 3.2% 

• Fiscal risks may also be higher with the reliance on extra-budgetary resources for financing a number of ambitious government spending programmes. In the Budget for 2018-19, the total outlay for three focus areas, namely, agriculture and rural livelihoods, infrastructure and education, and health and social sectors, amount to 11.6% of GDP.

• These are to be funded using budgetary and extra-budgetary resources. 

Final Words

• More than ever, the fiscal deficit needs continued vigilance. We need to stay the course.
Title: Testing the diagnosis 

(Why traditional and scientific medical systems cannot be integrated?)

All medical systems strive for one purpose — help the ill get well. Would it not be ideal if traditional and scientific medical systems were integrated into one system of curative medicine? 

• Three examples that have survived the test of time are the ancient Indian and Chinese traditional systems and the more recent homeopathy. All of them are together called ‘traditional medicine’.

• Homoeopathy, allopathy, Chinese system, Ayurveda 

• Two-three centuries ago. Scientific medicine developed and grew in Germany, Austria, France, Britain and the U.S. during the 18th and 19th centuries through an iterative and cumulative process.

• Scientific medicine can and must question and revise dogmas, concepts, explanations and therapeutics through research inquiries — that is what science is all about.

• In traditional systems, doctrines and therapeutics are given and fixed. 

• Verifiability in modern medicine comes with a price — as well as a prize. The price is that the physician’s diagnosis and treatment can be scrutinised and assessed against the system’s norms. Liability to negligence arises if norms were not followed; if guilty the physician can be penalised. The prize is correct diagnosis and treatment, irrespective of who the physician is — an immense benefit to the patient.

• If one physician makes a diagnosis and treats as such, the patient has the right to ask if both are based on evidences available in books and periodicals. In case the physician had not followed such norms, he/she is liable to be tried for medical negligence and the patient compensated, if so proven.

• In other words, scientific medicine demands ‘accountability’ on the part of the physician — for ‘correct’ diagnosis and treatment. Since such verifications and detailed classifications are not present in traditional medical systems, a physician diagnoses and treats as best as he/she could, but without verifiability or accountability. Fortunately, therapies in traditional medicines are generally harmless — hence patients do not face much risk.

Vocabulary words:

Title: Testing the diagnosis 
  • Integrate (verb) = Combine, unite (एकीकृत)
  • Strive (verb) = Struggle or fight vigorously (प्रयास करना)
  • Dogma (noun) = Teaching, belief (सिद्धांता)
  • Doctrine (noun) = Principle, belief (सिद्धांत)
  • Concoction (noun) = A mixture of various ingredients, digestion (पाचन-क्रिया)
  • Purgation (noun) = Purification or cleansing (विरेचन)
  • Deworm (verb) = Treat (an animal) to free of worms (स्वच्छ करना)
  • Lag behind (phrasal verb) = Fail to keep pace (पीछे रह जाना)
  • En (prefix) = Within, in , energy; enthusiasm
  • Scrutinise (verb) = Examine or inspect (छानबीन)
  • Assesse (verb) = Evaluate, judge (आंकना)
  • Compendium (noun) = Collection, compilation (सार-संग्रह)
  • Remedy (verb) = Treatment, cure (उपचार)

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