Union Budget 2016-17 and the North East By Bhagirathi Panda It is no secret that the finance Minister Mr Arun Jaitley had to present his budget in an economic environment characterized by more of gloom and less of advantage. The important manifestations of gloom are: the weak global economy with a slowdown of demand , stagnating domestic infrastructure(except highway constructions), high debt burdens of the corporates, high NPAs(Non Performing assets) of the banks, increased rural and agrarian distress, requirements of jobs far exceeding its creation and two consecutive poor monsoons. The two silver lines are the falling oil price and the comfortable foreign exchange reserves at USA $351 billon. In such a situation, making a budget and using it as cardinal instrument of economic and social development for a country like India was daunting. The budget has been presented. Now it is time for postmortem. Let me start this postmortem with my usual caveat that budget is neither the only economic policy paper nor the last word in economic policy making. There are many more policy papers, words and actions of economic policy that happen and I am sure would happen this time too, that walk off the realm of budget. Further, the recent implementation of the 14 th finance commission recommendation that has raised the share of states in the divisible pool of central taxes from 32% to 42%, has to some extent squeezed the revenue and resource intervention base of the central government. In such a situation, budget is essentially a benchmarking exercise that defines the fundamental contours of economic policy of the Government of the day. What is then, the thrust area of the budget? Without doubt, it is, economic growth through fiscal consolidation, demand enhancement, infrastructure big-push and institutional reforms. Embedded in it is the implicit assumption and explicit expectation of job creation. All these are to be realized now by a combination of ‘increased state presence in the rural economy’ and ‘predominant access to market forces in the urban economy’ and thereby giving a partial pass to the ‘get it all through market forces approach” that was the affirmed stipulation in the last budget. This is a very welcome and pragmatic step that acknowledges the complexities and nuances of development in Indian economy and society. Focus rural, start it with rural, consolidate it in rural and unleash it from rural is the reverberating principle of development of this budget. Therefore it is no surprise that the total allocation to rural development alone stands at a staggering amount of Rs. 87765 crore. The primacy of increased physical infrastructure provision through creation of augmented capacities in