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Will Budget 2015 slay the monster of inflation? Will it significantly lower fiscal deficit? Crucially, will it make India an efficient economy and hence an attractive investment destination?

Budget 2015 – Micromanaging the Economy

Does the Government have managers to micro-manage the economy? For starters, it must de-stall the projects stalled. To do so it must micro-manage. But has it got managerial bandwidth for this exercise?

Notwithstanding pulls and pressures will Budget 2015 bring about a simple plan for water storage by identifying, repairing and rejuvenating existing water bodies? Remember simplicity is a complex affair. It would not cost much and would provide ocular demonstration of job opportunities to our poor.

Will the FM do the needful? Or will he like his predecessor take a flight of fancy?

Budget 2015 – Income-Tax laws need simplifying

There are vested interests who would prevent simplification of Income-Tax law. And even if simplified, given years of training, our lawman cannot resist complicating matters all over again.

 

Budget 2015 has to come with a programme that differentiates the chalk from cheese; the bad from the ugly. Projects that have failed purely on economic reasons and judicial interventions must be differentiated from those where promoters have been party to the loot [and that includes corruption]. If Budget 2015 remains silent, things will drift further down, possibly to the point of no return. If it takes action on every defaulter and treats them as criminals it would create mayhem and a systemic collapse. Surely, it needs to tread on a new, balanced and pragmatic path.The billion dollar question is, will it?

Contrary to popular belief, Indians have been saving more post liberalisation.

In an unprecedented move, the global rating agency Standard & Poor downgraded the US Government’s “AAA” sovereign credit rating to “AA+” while keeping the outlook negative. That was in August 2011.

That in turn triggered massive convulsions in financial markets across countries, including India. Terming the situation as “grave” the then Finance Minister [FM] Pranab Mukherjee commented: “There are difficulties and some sort of a crisis. But there is no need to press the panic button.”

Crucially he added: “I do not want to worry unnecessarily. Our growth story is intact and our fundamentals are strong.”

The US downgrade is merely a context. Come any crisis, war or natural; economic or political, Indian economy has been by and large insulated from such negative developments. Indian economy is largely insulated from such crisis; the fundamentals of Indian economy are strong and by and large the Indian growth story is intact.

Are all these empty rhetoric? Or do these reflect undebated aspects of Indian economy? If the economic fundamentals of our economy are indeed strong why then express concern in the first place? Why national consternation when the stock markets gyrate on such negative developments?

Budget 2015 expectations from M.R. Venkatesh

At the core of the imbalance in our Central Budget is the interest bill arising out of a gargantuan borrowing program that has lasted well over three decades. Readers may be shocked to note that for every Rupee spent by the Central Government, approximately one-fourth is only on interest.

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