The high expectations that accompanied Indian Prime Minister Narendra Modi's landslide election win two months ago apply to all he says and does. Those who voted for him and investors want two years of lacklustre economic performance quickly turned around. The modest budget his finance minister Arun Jaitley unveiled earlier this month was therefore greeted by stock markets with a dive before the contents were properly digested, whereupon they rebounded. Aspirations have to be realistic; it will take years, not mere months, to implement the far-reaching reforms envisaged to get India's economy to where it needs to be.

Modi's Bharatiya Janata Party took power with India's first outright parliamentary majority in three decades on the back of promises to overhaul the economy. Anticipation was high that the first budget would create an economic paradigm shift. But it was unrealistic to expect a shakeup within weeks. Jaitley did well to unveil measures that were down-to-earth, with 7 to 8 per cent growth targeted over the coming three to four years.

Although short on detail, what he outlined has the right approach of attracting foreign investment and building much-needed infrastructure. He promised hi-tech cities, industrial corridors, power stations and ports. Ending disliked retrospective taxes for overseas investors and raising the caps on foreign investment in the defence and insurance industries, coupled with a new goods-and-services tax, makes sense.