While there are murmurs of token political opposition to Budget 2001-02, the reality that this is a historic budget, of 1991 proportions, is beginning to sink in. There are several similarities with that budget – extra-territorial imperative, a vision, and a shedding of chains – chains that had shackled economic freedom for almost fifty years. Indians had their first brush with economic azaadi in 1991 – Budget 2001 intends to complete the tryst with our rightful destiny.

Yashwant Sinha's 2001 budget is not a populist budget; nor is it an austere budget. It is the right budget. The challenge for any opposition politician, or analyst, is to find out what is there in the budget that should not be there, and what is not in the budget that should be there. She is liable to find null sets galore - that is how good this budget is.

If there is any criticism, it is that the reform of the fertilizer subsidy has been delayed till 2006. The political opposition might contend that the fertilizer subsidy should not be removed at all since it will hurt the "poor" farmers and/or lead to an increase in the price of food, the major consumption item of the poor. If such arguments take place, this will be in keeping with the politically rich tradition in India of politicians arguing for the most dastardly, corrupt policies "in the name of the poor". The reality is that, at least for the last five years, more than 90 percent of the fertilizer subsidy has accrued to the obscenely subsidized, and therefore obscenely inefficient, Indian fertilizer industrialists, in both the public and private sector. The total amount of this subsidy - an average of Rs. 10,000 crores each year, at least for the last five years.

The farmer pays almost the same price for fertilizer as his counterparts in the rest of the world; it is the Indian capitalist, aided and abetted by the government, who obtains the generous subsidy. What meaning does Rs. 10,000 crore per year have? One perspective is provided by the latest government estimate of poverty in India - 260 million poor. The poverty gap i.e. the difference between the mean incomes of the poor and the poverty line, is about 8 percent or less than Rs. 360 per poor person per year. Non-rocket science math would state that poverty each year can be reduced to zero with a total annual expenditure of Rs. 9360 crores. That is how obscene the fertilizer subsidy is; and that also indicates how the myriad in the name of the poor programs (so called subsidized food, electricity etc.) have always helped the non-poor. So when politicians criticize Budget 2001's intent to reduce the role of the Food Corporation of India in helping reduce poverty (a bandwagon some left economists are also thankfully joining) they should beware - the voter, poor and rich, will not take any more insults to her intelligence.

There are other bold initiatives in the budget. Reform of archaic labour laws, for example. The planning mentality of the bygone socialists had constrained every economic activity in India. If you had more than 100 employees, you had to seek government permission before any worker got fired. No one asked for the rationale behind 100 - why not 50, indeed why not even a single employee ? Was the logic that a person working for a small firm needed less protection from bad capitalists than a person working for a firm with 100 employees?

Almost by definition, logic never played a role in economic planning. The policy did not matter - whether fertilizer, sugar, food, electricity - or "small scale" reservations for the poor. To its credit, Budget 2001 takes all these absurd holy cows head on. Some people are wondering whether good intentions will be, can be, implemented ? Whether such policies are politically feasible? These questions assume a very low level of intelligence of the Indian voter - an impression contrary to reality. Don't believe me - ask any Congress party member. This party brought you socialism, and then the beginning of economic freedom. But rich socialists (I realize that there is a redundancy there) are human, after all; they wanted their good old days back. So they turned their back on reforms - and the voter kicked them for doing so. The Congress party strength today is less than 115 seats, and falling further in most voters perception.

Choodo kal ki batein, kal ki baat purani

Naiye daur mein likhen ge, mil kar nai kahini

Apart from being historic in economic terms, this budget may be equally historic in political terms. On the surface, the polity may appear divided. There is dissension on every issue; privatization, how to help the poor, taxation, how to help the poor, small scale reservations, how to help the poor, food subsidies, how to….To a woman from Mars, India must look like the most divided nation on earth - even more so than the former Yugoslavia.

But beneath the surface, and surface rhetoric, is a massive consensus on economic reforms. Whether the party affiliation is Congress or the CPM, NDA, BJP or their swadeshi cousins, even the RSS - all of them, practice economic reforms when they are in power. What is even more encouraging is the fact that the new Indian neta has a very high native intelligence, is politically savvy, and economically literate. They are an impressive lot, and while several of them are smart and corrupt, there is a majority that is smart, clean, and genuinely concerned about the state of the nation.

Given this reality, a safe forecast is that politicians of different political hues will find it difficult to obstruct freedom's train, especially since neither their heart, nor their mind, is in consonance with political suicide. Opposition for oppositions' sake will soon be proven to be a sterile, self-defeating exercise. It is the context of a new, and resurgent, India that the Vajpayee-Sinha budget is historic, and by being both economically and politically correct, at an opportune time. The challenge to them is to exploit their good sense, and good fortune and unite the dissension. All possible with very little effort. The policies they are advocating are not original to them or the opposition. The policies are in everyone's interests; and policies that will make possible an eight percent a year growth over the next decade; and an elimination of absolute poverty in the next five.