The immediate consensus among economists, public policy leaders and even politicians was that Prime Minister Najib Abdul Razak has put together a "tough" budget in difficult times.
However, there are questions on whether Najib's ambitious targets such as reducing deficit to 3.1 percent is achievable amid a fall in national revenue.
Bringing the deficit down is an important criteria for Malaysia's credit rating, therefore Najib (
photo
) has taken pains to convince the financial markets that he is committed to reducing the deficit.
RHB Bank group managing director Khairussaleh Ramli noted: "The fiscal deficit target of 3.1 percent of GDP, down from the revised Budget 2015 figure of 3.2 percent will not only take the country closer towards fiscal consolidation but will also strengthen its sovereign ratings."
However, Centre for Public Policy Studies (CPPS) chairperson Ramon Navaratnam believed the targets may be an optimistic view that may not be realised.
"Keeping the deficit down and the economic growth up at four percent and five percent for 2016 could be optimistic, given the international economic uncertainties," he said.
Ramon ( photo ) pointed out that concerns over 1MDB and the political crisis could erode public confidence and undermine the budget's assumption that the private sector can still lead in economic growth.
"The estimated inflation rate of only two to three percent may also be too low.
"With the weakening ringgit, the pressure on prices will rise," he said.
Challenges in achieving economic goals
Meanwhile, PKR's Pandan MP Rafizi Ramli said with scandals plaguing the prime minister, Najib will face challenges in achieving his economic goals.
"You can work out whatever you want and distribute the numbers but without credible economic leadership, it is unlikely that many of the projections will be realised.
"The economy is going to crumble," Rafizi ( photo ) said.
However, SUPP president Sim Kui Hian believed that Najib had made do with a challenging budget amid a slump in crude oil prices.
Among the plus he noted was the inclusion of more food and medicine in the zero-rated list for the good and services tax (GST).
He also commended the government's move to increase the minimum wage to RM1,000 in peninsula Malaysia and RM920 in Sabah and Sarawak, ensuring the Pan-Borneo expressway will be toll free and giving out interest free loan for rebuilding long houses.
Meanwhile, MIC leader S Vell Paari also praised Najib for tabling a "community-focussed" budget.
"The prime minister's vision of tabling a budget that invest directly in empowering the Indian community will result in providing better jobs and a better quality of life for the Indian community," he said.
