They pointed out that Finance Minister Nirmala Sitharaman relies a lot on divestments, where the government under-performed in FY2019-20, to achieve the 3.8 per cent fiscal deficit target.
The new government that presents the full Budget for 2024-2025 in July should be ready to restructure the way divestment is managed and implemented, proposes A K Bhattacharya.
Manufacturing activities in India gained momentum in August as new orders and output increased at the quickest rates in nearly three years, according to a survey released on Friday. The seasonally adjusted S&P Global India Manufacturing Purchasing Managers' Index (PMI) rose to 58.6 in August from 57.7 in July. Pollyanna De Lima, Economics Associate Director at S&P Global Market Intelligence, said the PMI results for India painted a vibrant picture of the nation's manufacturing landscape in August.
The Budget will be keenly watched (to see) whether there is a credible plan for reducing the fiscal deficit and whether populist measures can be avoided before the 2014 general elections," the Wall Street firm said in a note.
'They have started becoming an important player, but not at the same level as they were in the earlier part of the decade.'
State-run telecom operator BSNL on Tuesday said it expects to close the fiscal with 10 lakh 3G users from seven lakh at present.
Amid a debate on the freebies, the Election Commission on Tuesday proposed amending the model code to ask political parties to provide authentic information to voters on the financial viability of their poll promises.
Officials in the finance ministry are not happy with credit rating agency Fitch's revision of India's local currency outlook to negative from stable. Officials say Fitch's conclusion that the central government's fiscal deficit will rise to 4.5 per cent of gross domestic product in 2008-09, as against 2.8 per cent in the previous fiscal, is wrong.
"The need is to strengthen the judiciary as a consequence of which the justice delivery system becomes fast, qualitatively responsive and serve the purpose of justice," he said.
The government on Friday sought Parliament's nod for an additional Rs 54,000-crore spending mainly to meet its obligation towards GST compensation to states and defence-related expenditure. Minister of State for Finance Anurag Thakur presented the second and final batch of supplementary demands for grants in the Lok Sabha.
Budget has several small steps which will boost growth
As the duration of the FRBM Act, enacted in 2003, has come to an end, the government would be required to replace it with another law on fiscal consolidation.
Government's push for Make in India which focuses on select 26 sectors and improving the 'ease of doing business' will aid the manufacturing/industrial growth.
Improved monsoon, solid fiscal performance, and capex push by the public and private sectors augurs well for India's macroeconomic stability and growth, the finance ministry's monthly economic review for June 2023 said. But the report said that while India's domestic fundamentals remain strong, negative cross-border spillovers and adverse global developments could act as a deterrent in achieving the high growth path this financial year. "An improved matching of aggregate supply and aggregate demand in the Indian economy underpins the progress made in the control of domestic inflation and the consequent strengthening of macroeconomic stability," the review said.
The US fiscal deficit is still dangerously high, but nobody is moving to reduce it.
West Bengal lost Rs 546.68 crore (Rs 5.46 billion) in 2007-08 for not having its own fiscal responsibility law, which mandates fiscal discipline, according to the Comptroller and Auditor General (CAG).
"This is the result of tighter fiscal discipline imposed by the fiscal responsibility framework ... and an optimistic revenue outlook driven by the buoyancy in revenue collections during the last three years of the 10th Plan," the 11th Plan document points out.
Chief Economic Adviser K V Subramanian on Monday said India is likely to post current account surplus in the current financial year as there is moderation in import due to under heating of the economy triggered by the COVID-19 crisis. This crisis is different from what the world witnessed during the taper tantrum, he said while addressing a virtual conference organised by industry body CII. Taper tantrum phenomenon refers to the 2013 collective reactionary response that triggered a spike in US treasury yields, after investors learned that the US Fed was slowly putting brakes on its quantitative easing (QE) program.
The Left parties which had raised the issue were not satisfied with his reply and walked out and they were joined by Samajwadi Party.
Inflation data, both at domestic and global level, interest rate scenario in the US, geopolitical situation and general elections in 2024 are some of the major factors that would influence trading in the equity market this financial year, analysts said. Besides, foreign fund trading activity and global trends will also dictate terms in the equity market going ahead. Equity markets across the globe faced major challenges in FY23 due to concerns over high inflation, which resulted in increase in interest rates around the world, lowering investor sentiment, experts added.
The obvious temptation for Mr Jaitley would be to achieve a better fiscal deficit figure than what he had promised in July.
Chief Economic Advisor Krishnamurthy Subramanian said China imports a lot of components, parts, assembles and integrates and then exports them.
The extra 1.3 billion pounds comes from the Reserve, funds the UK government said it has set aside for the most pressing emergencies.
Vijay Kelkar, who headed the committee on tax reforms, on Tuesday warned that higher economic growth and foreign direct investment flow could not be achieved without hard fiscal reforms.
The services sector growth in India fell to a one-year low in November on softer expansions in new work intakes and output, despite receding price pressures, a monthly survey said on Tuesday. The seasonally adjusted S&P Global India Services Business Activity Index fell from 58.4 in October to a one-year low of 56.9 in November. Despite witnessing a month-on-month decline, the rate of expansion was stronger than its long-run average.
Ahead of the Budget, global rating agency Standard and Poor's has warned India may not be able to achieve the fiscal responsibility and budget management target of axing fiscal deficit and projected a lower growth of 6 per cent this fiscal.
Sitharaman does away with loans from National Small Savings Fund to Food Corporation of India.
"We are on track to bring down fiscal deficit to 3.3 per cent this year and to three per cent in the next year and hopefully remove revenue deficit in 2008-09", Finance Secretary D Subbaro said while speaking at the launch of the OECD economic survey of the Indian economy in New Delhi on Tuesday. The Fiscal Responsibility and Budget Management Act requires the government to reduce fiscal deficit to three per cent of the GDP and eliminate revenue deficit by 2008-09.
Two important features are Effective Revenue Deficit and Medium Term Expenditure Framework.
Finance Ministr Arun Jaitley will have to do a balancing act to manage fiscal prudence.
The finance minister could well be on her way to setting a record of achieving the biggest single-year reduction in the government's fiscal deficit, explains A K Bhattacharya.
The BJP is the preferred choice because it offers what the Mughals and later British offered in their time: A stable polity and an environment in which business could function, explains T N Ninan.
Bharti Airtel made part payment of Rs 4,725 crore.
'Aggressively stepping up vaccinations will constitute the most enduring stimulus of all in the coming quarters,' observes Sajjid Z Chinoy, Chief India Economist at J P Morgan.
Blame the voter, who invariably chooses the promise of hand-outs today in preference to a vague promise of, say, better schools tomorrow. Getting the Supreme Court to issue an edict, or Parliament to pass a law, is no solution, observes T N Ninan.
He did not believe in any fiscal puritanism. In 2012, when it was almost certain that the government will breach the 2012-13 fiscal deficit target, he wrote that in abnormal times, abnormal measures are required to get back to normalcy.
India's inclusion in JP Morgan's bond index can channel billions of dollars into India. How will the government securities market handle it?
The Centre will take a hit of Rs 26,000 crore (Rs 260 billion) in 2005-06 by implementing the twelfth finance commission's proposal of a higher share of central taxes, grant and debt relief to states.
The games began a few months ago, when the finance ministry and the Planning Commission got into their well-publicised spat.
