If Nirmala Sitharaman does indeed present a 'never-before' like Budget on February 1, going by her promise, she would create a new benchmark for post-contraction Budgets, observes A K Bhattacharya.
'But can it afford to present a scenario within the existing legal framework of fiscal consolidation?', asks A K Bhattacharya.
Can the finance minister manage our expectations, asks A K Bhattacharya.
Clearly, the extra borrowing of Rs 4.2 trillion the government has planned so far will not be enough to meet the shortfall in revenues which could be between Rs 8 trillion and Rs 10 trillion, points out A K Bhattacharya.
IThe fiscal deficit target for 2020-2021 was originally set at 3.5 per cent of GDP. But the government's revenues have collapsed and its expenditure burden will only increase over the Budget estimates.' With the government having already planned for an additional borrowing of over Rs 4 trillion, the fiscal deficit for the current year would be much higher than the Budget estimate, notes A K Bhattacharya.
The oil sector has been quite lucky for the Modi government. It has often provided an opportunity to the government to mend its finances, notes A K Bhattacharya.
'There can be no dispute over the adverse impact such a policy will surely have on India's manufacturing competitiveness,' notes A K Bhattacharya.
The question on who should borrow from the market and whether the borrowing will be under two buckets should be decided by the GST Council, and not by the Centre. If there is no consensus, there has to be a vote, says A K Bhattacharya.
Pranab Mukherjee's stewardship of the economy will stand out as much for the manner in which he managed controversies as for creating quite a few of them, says A K Bhattacharya.
'It may be prudent not to plunge into a new online tax appeals system in one go, which could only create more disputes and increase the embarrassingly high tax arrears of the government,' warns A K Bhattacharya.
Far more important than governance is to ensure how different states get necessary representation a'The pressure to expand the council of ministers will come from states where the BJP has formed a government after ousting the Congress,' predicts A K Bhattacharya.
'An explanation perhaps lies in the culture of revisions that has grown deep roots in the government data collection system,' notes A K Bhattacharya.
'The road ahead for the government's fiscal management will be full of many new challenges,' warns A K Bhattacharya.
It is time the government cast its net wide for seeking expert advice on managing the Indian economy and formed a group to help it navigate the difficult days ahead, advises A K Bhattacharya.
Every time the Indian economy has faced headwinds due to international developments, the oil sector has played a crucial role, explains A K Bhattacharya.
'Given that the economy is going through a slowdown, further downward revisions of the 2019-2020 growth estimates cannot be ruled out,' notes A K Bhattacharya.
'Instead of wailing about the absence of tax benefits, the private sector should press for an early implementation of the package of measures,' advises A K Bhattacharya.
'As much as $4 billion in India's start-up companies has come from Chinese funds.' 'Government policy must not remain indifferent to the problems India's start-up ventures are likely to face after the change in FDI rules,' says A K Bhattacharya.
'The impact of COVID-19 on the economy has been so overwhelming that even a significant drop in global oil prices, which in normal times would have brought cheer, has posed new challenges for the government,' observes A K Bhattacharya.
'How the lockdown is phased out or lifted will tell us if the government has succeeded in its battle against COVID-19.' 'If it cannot sequence its decisions on exiting the lockdown, the few gains secured so far may be frittered away,' says A K Bhattacharya.
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