Rajan said RBI is in the process of creating a framework which will make the sustainable growth possible.
For the banking system a new cycle starts in FY2024. It's fraught with fresh challenges on asset quality and profitability, warns Tamal Bandyopadhyay.
'Banks have to be braver, willing to take more risks and give confidence to the customer,' observes Joydeep Ghosh.
No longer Bengal's finance minister, Amit Mitra, Mamata's principal chief advisor, will still advise and aid the 'chief minister and finance department on all matters relating to management of state finance', represent the 'state government in national and international events/meetings/committees' and examine 'important proposals/files and policy issues relating to financial matters referred to him for advice/views'.
'You need to devalue the currency, ignite inflation, which then begins to oil the wheels of the economy.' 'Without that this severe recession is not going to reverse.'
Experts believe there are more such decisions in the offing, which along with a recovery in economic growth and India Inc.
Rajan had cautioned against any deviation from the fiscal discipline path.
'GST will bring in much needed transparency and higher investments in the coming years and we hope that a few percentage points to India's GDP.'
The opposition party also claimed that the Modi 2.0 dispensation has turned out to be an "economic and political disaster" and "constant rollbacks" of economic decisions will lead to worsening of the economic situation.
Capex for next year expected to be up 25% to Rs 3 lakh crore
The government has been waiting for the expansion by the private sector, Finance Minister Nirmala Sitharaman said while reminding India Inc of various measures including corporate tax rate cut, policy consistency, ease of doing business, among others to facilitate investment.
Citigroup Inc, the largest US bank, has asked India to liberalise its financial services sector, saying it would help the country maintain and improve over eight per cent GDP growth.
This year, the combined net profit of 24 index companies, which have declared their June-20 numbers, has declined by 37 per cent year on year, while their revenues, including other income, is down by 21 per cent YoY so far.
'It is a balanced and prudent Budget that sets the foundation for future growth in the economy.'
Bill Gates specifically complimented India's Aadhaar identity system and the country's performance in the financial services and pharma sectors.
Speaking at industry association CII's annual session, PM Modi said the government has taken tough steps to fight the coronavirus pandemic and has also taken care of the economy. "On the one hand we have to safe the lives of our people and on the other hand we have to stabilise the economy and speed up the economy," he said. "Yes, we will definitely get our growth back," he asserted.
Global growth, according to IMF, likely to be lower at 3.3%
Budget has laid emphasis on enhancing expenditure in farm & rural, and social sector including healthcare, education, skill development, job creation and infrastructure
Market cap of government companies has remained unchanged in the past 8 years.
Though it is likely gross domestic capital formation increased in the quarter ended June, against declines in the previous two quarters, a significant revival in investment might take a few quarters more, economists say.
Companies in China, South Korea and Indonesia pay 25 per cent tax, while those in Malaysia pay 24 per cent. Only Japan has a higher tax than India at 30.6 per cent. Hong Kong has the lowest corporate tax rate of 16.5 per cent while Singapore has 17 per cent rate and Thailand and Vietnam levy 20 per cent tax on companies.
Demonetisation impact, earnings growth, central bank policies will get attention.
This is the BJP's first full-year Budget.
The industrial output for the third month in a row remained in the negative territory, contracting 1.5% in January
Slowdown persists in China. India's GDP estimates for 2015-16 are liable to be pared; projections for 2016-17 are lacklustre.
For India, it is business as usual with the government muddling along.
Short-term gains are always unpredictable.
'Tax cuts will have only marginal effects in the short run and significant positive effects in the medium term,' says Shankar Acharya, former chief economic adviser to the Government of India.
Even as rising crude oil prices, trade war fears and a sliding rupee cast a shadow on market sentiment, Nischal Maheshwari, chief executive officer for institutional equities and advisory at Centrum Broking, tells Puneet Wadhwa that in the next one year, the outcome of the 2019 general election is a bigger challenge for the market.
In the past 12 months, such earnings have grown in double digits in Europe, the US, Japan and South Korea.
'Prime Minister Modi's message from Tuesday's meeting with industrialists was loud and clear: stand up India, stand by start-ups, take risk and invest,' says CII chief Sumit Mazumder.
RBI said inflation in the second half of the current fiscal is projected at 2.7-3.2%. It retained its GDP forecast for the current fiscal at 7.4%
'The Modi regime is not willing to use its huge political capital for taking any economic policy measure that it fears might undermine that political strength, says A K Bhattacharya.
'The rate cut could have been higher in the current economic conditions which would have had a stronger impact on business sentiment and spurred investment in a big way.'
'It is unlikely that foreign portfolio investors (FPIs) might increase their India allocation, given the overweight status for most FPIs.' 'Given the commentary from the Republican Party, an anti-imports approach means money will not flow out of the US.'
2014 was a year for downturn for most economies across the globe.
There has been no reboot of the private investment cycle.
The government on Wednesday approved a Rs 7,350-crore scheme to boost production of laptops, tablets, all-in-one PCs and servers in the country, as it sought to woo global and domestic players to take advantage of India's manufacturing prowess. Production worth Rs 3.26 lakh crore and exports of Rs 2.45 lakh crore are estimated over the next four years under the new scheme, which is expected to create 1.80 lakh jobs. Briefing reporters after a meeting of the Cabinet, Communications and IT Minister Ravi Shankar Prasad said the Production Linked Incentive (PLI) scheme has been approved for IT hardware products that would cover laptops, tablets, all-in-one PCs and servers.
Bankers need to take a call on whether they will allow technology firms to run banks or banks themselves will turn into tech firms, says Tamal Bandyopadhyay.
'The current crisis is one of incomes, driven by poor job growth, agrarian distress and poor investment sentiment,' notes Harsh Pati Singhania, director, JK Organisation.
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