Sitharaman's Budget missed deficit target for the third year in a row, pushing shortfall to 3.8 per cent of GDP in the current fiscal as compared to 3.3 per cent previously planned.
Sentiment in the market will also be guided by other major market movers like trend in the rupee, Brent crude and foreign capital flows.
The finance minister (FM) in his speech confirmed growth forecasts in the Economic Survey that the economy is likely to grow at 8.6 per cent during the current fiscal.
If you look at the broad numbers, industrial growth in the first five months of this year was 5 per cent, compared to 10 per cent a year earlier. As for next year, the International Monetary Fund has in the space of a month lowered its forecast from 6.9 per cent to 6.3 per cent -- a range where perhaps only one Indian forecaster has dared to tread so far.
However, the World Bank has projected India's GDP growth rate at 7.5 per cent for the next three financial years, including the current one.
Shocks from Brexit could also hurt one of China's biggest export markets.
Finance Minister Nirmala Sitharaman on Thursday said the Indian economy is witnessing a strong recovery after a long and strict lockdown. Addressing a press conference to announce more stimulus measures to boost growth, she said macro-economic indicators are pointing towards recovery. She noted that COVID-19 active cases have declined from over 10 lakh to 4.89 lakh with case fatality rate (CFR) at 1.47 per cent.
'We get to know secrets such as some of India's top-rated firms do not always make payments when due and many State-owned, listed, enterprises that borrow in bond markets default regularly.' 'Without naming the bank, he says that ever-greening of poor loans by a part of India's shadow banking lay at the doorstep of India's banking, notably 'one private bank'.' Viral Acharya's Quest for Restoring Financial Stability in India won't be music to many ears, observes Tamal Bandyopadhyay.
Usually, a fall in oil prices is followed with a cut in retail prices of auto fuels and the government passes on the benefit to consumers. However, Morgan Stanley believes gains this time around will remain capped.
After swinging 439 points during the day, the 30-share Sensex ended 141.33 points, or 0.38 per cent, lower at 37,531.98. It hit an intra-day low of 37,480.53 and a high of 37,919.47.
Ahead of the Economic Survey, industry body Ficci today lowered its GDP growth forecast for the current fiscal, pegging India's economic expansion rate at 5.3 per cent compared to its 5.5 per cent previous estimate.
Buoyed by an increase in public investment and incentives to boost manufacturing, India's economy is expected to grow by 8.3 per cent in the fiscal year 2021-22, less than the previous projection early this year before the country was hit by the second wave of the COVID-19 pandemic, the World Bank has said in its latest report. World Bank chief economist for the South Asia Region Hans Timmer told PTI here that when one looks at the high frequency data, they see that as a result of the second wave of the COVID-19 pandemic, the recovery paused, and some indicate that the recovery actually declined briefly. "We project for this fiscal year 8.3 per cent (growth rate for Indian economy) that is less than we projected early in the year before the health crisis caused by the second wave. "Given the sharp contraction of the economy last year, it might not look like a lot, but in my view, that is actually very positive news, given the violent second wave and the severity of the health crisis," he said on Thursday.
Bangladesh might overtake India this year by per capita income in nominal dollars, but it is not yet close to becoming South Asia's economic powerhouse anytime soon, T N Ninan points out.
The Niti Aayog vice chairman noted that green shoots of recovery are already visible in multiple sectors. In 15-16 sectors, businesses are coming back to pre-COVID levels," he said.
Negotiations on the looming "fiscal cliff" will dominate talk in Washington this month, with both the White House and congressional Republicans having made early offers.
At a pre-Budget meeting, the FM was asked to ensure that NBFCs come out of the liquidity crisis they are facing with the help of RBI. They also spoke about the futility of trying to achieve a 3 per cent fiscal deficit target over the medium term.
'While growth will bounce back from the current sub-5 per cent, it will stay lower than the already inadequate long-term average of 6.6 per cent,' notes T N Ninan.
