I am behind the pundit-curve in my comments on the latest Union budget, which was, of course, the first full-year budget of the Modi-led government, and therefore an occasion of some anticipation. Since the Budget has many different components, it is difficult to absorb it and sum it up quickly, but we all try to do that, of course, and many pronouncements have already been made, almost instantaneously. In a world of Facebook and Twitter, I am tempted to abandon all pretence of sounding like a pundit, and simply list what I liked and did not like. So, here goes.

Likes
* Simplifying various taxes and tax rates, including getting rid of the wealth tax and replacing it with an income tax surcharge for the super-rich and combining cesses into more uniform indirect tax rates.
* Making clear statements against retrospective taxation and postponing the General Anti-Avoidance Rules until they can be made into something sensible.
* Promising a lower corporate tax rate with fewer exemptions, to achieve greater efficiency in corporate taxation.
* Not raising the exemption threshold for personal income tax, to broaden the direct tax base, but instead providing greater tax incentives for financial savings.
* Supporting financial sector reform, including a separate government debt management agency, a transparent monetary policy framework, better small business finance, a new financial hub in Gujarat, and reform of bankruptcy laws.
* Announcing the setting up of an infrastructure fund, with attention to roads, railways, ports, power and telecommunications.
* Preserving recently-introduced welfare programs, but outlining steps to make targeting more effective and delivery more efficient, while augmenting them with new social insurance programs that address downside risks for poor households.
* Introducing some simplification and ease in foreign investment procedures.

Making an explicit commitment to an agricultural common market for India.
* Beginning the process of adjustment to the new tax sharing norms put forward by the Fourteenth Finance Commission.

Dislikes
* Not paying enough attention to how government expenditure can be made more effective. More devolution to and greater flexibility for the states will help, but there needs to be concerted attention (and expenditure) on increasing governance capacity by improving budgeting practices and information technology infrastructure at the state level.
* Not signalling the end of plan transfers, and the plan-non-plan distinction—though this has to come sooner than later—and not pushing down categorical spending schemes to the state level, for state governments to own and implement.
* Not paying enough attention to institutional reform in infrastructure areas such as electric power and urban sanitation. Electric power is the perennial infrastructure constraint for Indian firms, and perhaps the deficiencies in this sector cost one percentage point of growth each year. Building toilets without a sanitation infrastructure makes no sense: discharging untreated sewage into rivers and groundwater is as big a problem as lack of toilets.
* Not enough attention to higher education reform, which needs more than opening new institutes—how are shortages of top-notch faculty and education administrators to be overcome?
* Not enough attention to making the tax regime friendly to start-ups that have high human capital and high risk—mostly, but not entirely, technology sector firms. This works against the goal of lowering rates and removing exemptions, but it provides an opportunity for rethinking how to incentivise investment, not focusing on sectors or geographic areas, but on ameliorating downside risks for entrepreneurs.
* Not really being clear on how the massive skilling program is going to be effective, when other central ministries have routinely failed to deliver on providing health and education effectively and efficiently—how expenditure effectiveness and outcomes in all these areas will be improved in practice was not addressed in the budget.

My last dislike has nothing to do with the budget, perhaps, but there are shadows of the problem in measures such as granting yoga (presumably places which offer yoga practice or training) tax-exempt status, or the blind spots with respect to higher education, or the pretence to care about women’s welfare. There is a certain schizophrenia in the government, which speaks about equality of all and actively seeks foreign money and tourists, but preserves and feeds a deep cultural regressiveness—bordering on paranoia—as evidenced by its campaign against the BBC documentary on the Delhi gang rape of 2012, and other instances of censorship and religious and gender violence. Reciting mantras, making speeches, or even making R1,000 crore allocations are all negated by other actions within the government.

The  last is a bigger issue than any single aspect of tax or expenditure policy, but one would hope that improved material well-being that comes with higher economic growth and better governance is also accompanied by greater social intelligence, maturity, openness, understanding and equality. Without those, India cannot claim to be truly progressing.

The author is professor of economics, University of Caifornia, Santa Cruz