It might be fun to draft a model insurance policy that could cover the risks of adverse budgetary provisions. The nitty-gritty aspects would be difficult to calculate because of the mind-numbing details of the Finance Bill.

But the concept isn't as startling as it may seem. If such policies were on offer, these would surely find takers among Indian corporations.

Conceptually, the Budget is a political exercise and ergo, the risks embedded in its provisions are a subset of political risks.

Global insurers create specific covers for political risks. The idea has already been seen in the Indian context in association with the Dabhol Project.

A Budget-related insurance policy could perhaps be drafted along the following lines: it would include a generic premium that provided cover for across-the-board hikes in corporate tax rates; it could also include specific premiums for discriminatory changes in the excise, customs and service tax rates pertaining to specific industries.

Thus, if an industry was dragged into the service tax net for the first time, policy-holders could receive a payout from the insurer.

If the excise rate for a specific product was raised or there was a higher impost on the import of raw material, once again the insurer could compensate the loser.

Of course, this won't happen but a "shadow" policy might have its economic uses, providing a second-guess of what the market expects. Actual political risk cover will still be taken out by the age-old method of building networks of influence in the corridors of power.

Every industry is currently frantically lobbying to ensure that it won't be disproportionately affected.

The Budget is the single most significant influence on annual economic growth. That won't change in 2004-05 but there are several other policy that may collectively have a larger influence than the Budget.

Value-added tax, for example, will bring enormous changes in the mercantile landscape. It's a fine idea -- a tax on value-addition with rebates at every step along the chain.

Eventually, it should lead to lower final prices and lower levels of corruption coupled to higher tax-compliance.

But it took the European Union several years to implement VAT successfully. Europe's bureaucracy is collectively better than the Indian bureaucracy in terms of both honesty and efficiency so, it's anyone's guess how long it will take India to transit from the old system of leakages and embedded corruption.

In addition, there is certain to be acrimony between various states and the Centre on dividing up the VAT pie.

Another policy discontinuity of interest is the end of the textile quota regime. It's being perceived as a massive opportunity and the trigger for a head-to-head fight with China.

But it may not turn out that way. Who knows until it's in place?

The change in the patents regime also poses both a massive threat and opportunity. In the pharma industry, it should open up massive employment opportunities in R&D.

It will mean the flowering of more Indian contract research boutiques as well as in more offshored labs controlled by foreign multinationals.

The better-prepared Indian multinationals will also get a chance to fight for a larger slice of the mega-trillion global market. At the same time, business models that depended on process patents will evaporate.

The new patent regime also implies more expensive drugs at retail level and that could create discontent.

It's also unclear how much the change in the intellectual property regime will mean to the IT industry and to IT-dependent offshoots like biotech.

More proprietary algorithms could be developed and more design-related work might occur. But that's already happening; most IT multinationals already have a big R&D presence in India.

Overall though, this is one year when the Budget may be overshadowed by other changes in policy. Those discontinuities could merge to cause a big bang effect like the New Economic Policy of 1991.