The document discusses several challenges for India's upcoming 2017-18 budget. It notes that including railways estimates and abolishing the plan/non-plan distinction will impact the budget's complexion. It also cites declining manufacturing and commodity prices negatively impacting rail freight revenues. Other challenges include a deepening manufacturing crisis reducing tax revenues, rising public sector bank NPAs, and pending wage increases for public sector workers and the military. The large government debt and interest payments are also major constraints on public expenditure proposals for the new budget.
The document gives highlights from key sectors – agriculture and rural development, banking, financial services and insurance, defence and aviation, e-commerce and retail, energy, FMCG, food & beverages, infrastructure and housing, manufacturing, railways, social welfare, steel and mining, and technology IT & telecom.
The Union Budget for 2017-18 pledged relief for rural India, middle class taxpayers and small and medium-sized companies in the Union Budget 2017-18, saying the government would spend thousands of crores to double farmers' incomes, upgrade infrastructure and provide affordable housing. While unveiling the budget the Hon’ble Finance Minister emphasised that the budget is built on three pillars “Transform, Energise and Clean India”, that is, TEC India. This agenda of TEC India seeks to transform the quality of governance and quality of life of the citizens of India, energise various sections of society, especially the youth and the vulnerable sections of the society and enable them to unleash their true potential. The emphasis of TEC India is also to clean the country from the evils of corruption, black money, and non-transparent political funding. The main focus of the Budget has been to boost government expenditure in order to increase growth, and to muster employment generation.
The Finance Minister said the Indian economy was doing well despite global trends of slowing growth in other emerging economies. He also delivered a big relief to foreign portfolio investors by exempting them from indirect transfer provisions. The centre’s budget size has been pegged at Rs. 21.47 lakh crore, with an increase of 25.47 per cent in capital expenditure. As regards fiscal consolidation, the FM has targeted fiscal deficit of 3.2 per cent for 2017-18 as against earlier target of 3 per cent. For agriculture and rural sector, Mr Jaitley has increased the allocation by 24 per cent to Rs. 1.87 lakh crore for 2017-18. In the case of infrastructure, the planned public investment stood at massive Rs. 3.96 lakh crore.
We have developed an analysis of the budget, which includes opinion pieces from eminent economists and experts.
Edelman India Analysis
Standing in for Mr Arun Jaitley, Finance Minister (FM), Piyush Goyal presented the Union Budget of India earlier today. Highlighting achievements of various Government schemes, Mr Goyal stated that the Government led by Prime Minister Modi has been the most decisive and transformational in executing structural reforms.
Focused on rural and inclusive development over the next 5-10 years, the Budget included significant announcements ahead of the General Elections while also outlining ten dimensions of the Government’s Vision for India’s development by 2030. The launch of, “Pradhan Mantri Kisan Samman Nidhi (PM-KISAN),” which aims to supplement rural income, captured the limelight of this year’s budget. The middle class has also benefited with higher gratuity, broadening of the tax-exempt bracket and waivers on income tax on notional rent. A mega pension scheme for workers in the unorganised sector was also announced along with health coverage under the ‘Ayushman Bharat’ scheme.
The Government has budgeted for overall expenditure of INR 27.8 trillion in 2019-20, an increase of 13% over the previous year’s estimates, while targeting a fiscal deficit of 3.4% in 2019-20 and 3% in 2020-21.
The Union Budget for 2018-19 was proposed by Mr. Arun Jaitley on 1st February 2018. The budget proposes significant initiatives for rural & agricultural development, generation of employment, skill development and upgrading infrastructure, but, provides little incentive to the taxpayers. Sharing with you the highlights of this year's Budget.
The document gives highlights from key sectors – agriculture and rural development, banking, financial services and insurance, defence and aviation, e-commerce and retail, energy, FMCG, food & beverages, infrastructure and housing, manufacturing, railways, social welfare, steel and mining, and technology IT & telecom.
The Union Budget for 2017-18 pledged relief for rural India, middle class taxpayers and small and medium-sized companies in the Union Budget 2017-18, saying the government would spend thousands of crores to double farmers' incomes, upgrade infrastructure and provide affordable housing. While unveiling the budget the Hon’ble Finance Minister emphasised that the budget is built on three pillars “Transform, Energise and Clean India”, that is, TEC India. This agenda of TEC India seeks to transform the quality of governance and quality of life of the citizens of India, energise various sections of society, especially the youth and the vulnerable sections of the society and enable them to unleash their true potential. The emphasis of TEC India is also to clean the country from the evils of corruption, black money, and non-transparent political funding. The main focus of the Budget has been to boost government expenditure in order to increase growth, and to muster employment generation.
The Finance Minister said the Indian economy was doing well despite global trends of slowing growth in other emerging economies. He also delivered a big relief to foreign portfolio investors by exempting them from indirect transfer provisions. The centre’s budget size has been pegged at Rs. 21.47 lakh crore, with an increase of 25.47 per cent in capital expenditure. As regards fiscal consolidation, the FM has targeted fiscal deficit of 3.2 per cent for 2017-18 as against earlier target of 3 per cent. For agriculture and rural sector, Mr Jaitley has increased the allocation by 24 per cent to Rs. 1.87 lakh crore for 2017-18. In the case of infrastructure, the planned public investment stood at massive Rs. 3.96 lakh crore.
We have developed an analysis of the budget, which includes opinion pieces from eminent economists and experts.
Edelman India Analysis
Standing in for Mr Arun Jaitley, Finance Minister (FM), Piyush Goyal presented the Union Budget of India earlier today. Highlighting achievements of various Government schemes, Mr Goyal stated that the Government led by Prime Minister Modi has been the most decisive and transformational in executing structural reforms.
Focused on rural and inclusive development over the next 5-10 years, the Budget included significant announcements ahead of the General Elections while also outlining ten dimensions of the Government’s Vision for India’s development by 2030. The launch of, “Pradhan Mantri Kisan Samman Nidhi (PM-KISAN),” which aims to supplement rural income, captured the limelight of this year’s budget. The middle class has also benefited with higher gratuity, broadening of the tax-exempt bracket and waivers on income tax on notional rent. A mega pension scheme for workers in the unorganised sector was also announced along with health coverage under the ‘Ayushman Bharat’ scheme.
The Government has budgeted for overall expenditure of INR 27.8 trillion in 2019-20, an increase of 13% over the previous year’s estimates, while targeting a fiscal deficit of 3.4% in 2019-20 and 3% in 2020-21.
The Union Budget for 2018-19 was proposed by Mr. Arun Jaitley on 1st February 2018. The budget proposes significant initiatives for rural & agricultural development, generation of employment, skill development and upgrading infrastructure, but, provides little incentive to the taxpayers. Sharing with you the highlights of this year's Budget.
Finance Minister Arun Jaitley presented the Union Budget for 2016-17 and reaffirmed that the economy is on the right track. The budget is aimed at strengthening India's firewalls by ensuring macroeconomic stability and prudent fiscal management; driving growth through domestic demand; and economic reforms and policy initiatives to change lives for the better. With measured focus on social sector reforms and recapitalising India's banking system, this Budget has an overarching focus on improving agriculture, and scaling infrastructure, all of which bode well for the country. The government is now planning to rationalise and channel subsidies to the poor by increasing the burden on the rich, and by increasing spending on public welfare through its own kitty.
Mr. Jaitley said the Union Budget is aimed at improving rural infrastructure and increasing rural income, as the biggest challenge to the economy is agrarian distress. Applauding the budget presented by the Finance Minister, Prime Minister Narendra Modi said the Budget is pro-village, pro-poor and pro–farmers, and is focused on bringing about qualitative changes in the country through a slew of time-bound programmes.
The attached note captures key highlights and summarises major announcements in the Budget.
Please reach out to us should you wish to understand more about the Union Budget and its impact on your business
A Summary of Budget 2016!
Hon. Finance Minister Mr.Arun Jaitley presented a resilient India Budget 2016 which spells the ‘Transformative Agenda’ for the India Economy identifying nine key pillars for the GDP growth. Team RAMA has presented an overall overview of the Union Budget – 2016, summarised key policies changes and Direct & Indirect taxes proposals in brief for easy understanding and quick reference. Hope you will find it useful.
Warm regards & happy reading!
- Ram Agarwal & Associates.
Edelman India Public Affairs team provides an analysis of the Union Budget 2018-19 tabled in Parliament on Feb 1 -- featuring opinions from eminent economists and industry experts.
Contributors include:
Mr. T.S. Vishwanath
Partner, APJ-SLG Law Offices and Senior Advisor, Edelman India
Mr. Nirankar Saxena
Deputy Secretary General, FICCI
Dr. Geethanjali Nataraj
Professor of Applied Economics, Indian Institute of Public Administration
Dr. Amir Ullah Khan
Development Sector Economist, Professor and Director at the Maulana Azad National Urdu University, Visiting faculty of Economic Policy at the Indian School of Business
Mr. Neeraj Bansal
Partner and Head – ASEAN Corridor and Building, Construction and Real Estate sector, KPMG in India
Mr. Ravi S. Kochak
Former Additional Member (Production Units), Indian Railways
The finance minister maintained a commendable balance between the evenly stronger and mostly diverging compulsions of economic growth, fiscal discipline and political expediency.
Most of the budget provisions are inarguably aimed at ensuring inclusive growth, and bringing in equity in taxation and provisions.
A record number of measures have been introduced, to bring predictability, transparency and conciliation in the tax regime of the country.
It gives me a pleasure to present the summary and analysis of Union Budget 2016.
While you may have the snapshot, here is a document which will not only give you crisp highlights, but would also decode the impact of Budget 2016 on You, Your company and Your sector.
Hope you find this analysis useful in taking business decisions and align your company's strategy with over all economic climate for the upcoming financial year.
Would love to hear your feedback on the usefulness of the same.
Thanks a lot.
Finance Minister Arun Jaitley presented the Union Budget for 2016-17 and reaffirmed that the economy is on the right track. The budget is aimed at strengthening India's firewalls by ensuring macroeconomic stability and prudent fiscal management; driving growth through domestic demand; and economic reforms and policy initiatives to change lives for the better. With measured focus on social sector reforms and recapitalising India's banking system, this Budget has an overarching focus on improving agriculture, and scaling infrastructure, all of which bode well for the country. The government is now planning to rationalise and channel subsidies to the poor by increasing the burden on the rich, and by increasing spending on public welfare through its own kitty.
Mr. Jaitley said the Union Budget is aimed at improving rural infrastructure and increasing rural income, as the biggest challenge to the economy is agrarian distress. Applauding the budget presented by the Finance Minister, Prime Minister Narendra Modi said the Budget is pro-village, pro-poor and pro–farmers, and is focused on bringing about qualitative changes in the country through a slew of time-bound programmes.
The attached note captures key highlights and summarises major announcements in the Budget.
Please reach out to us should you wish to understand more about the Union Budget and its impact on your business
A Summary of Budget 2016!
Hon. Finance Minister Mr.Arun Jaitley presented a resilient India Budget 2016 which spells the ‘Transformative Agenda’ for the India Economy identifying nine key pillars for the GDP growth. Team RAMA has presented an overall overview of the Union Budget – 2016, summarised key policies changes and Direct & Indirect taxes proposals in brief for easy understanding and quick reference. Hope you will find it useful.
Warm regards & happy reading!
- Ram Agarwal & Associates.
Edelman India Public Affairs team provides an analysis of the Union Budget 2018-19 tabled in Parliament on Feb 1 -- featuring opinions from eminent economists and industry experts.
Contributors include:
Mr. T.S. Vishwanath
Partner, APJ-SLG Law Offices and Senior Advisor, Edelman India
Mr. Nirankar Saxena
Deputy Secretary General, FICCI
Dr. Geethanjali Nataraj
Professor of Applied Economics, Indian Institute of Public Administration
Dr. Amir Ullah Khan
Development Sector Economist, Professor and Director at the Maulana Azad National Urdu University, Visiting faculty of Economic Policy at the Indian School of Business
Mr. Neeraj Bansal
Partner and Head – ASEAN Corridor and Building, Construction and Real Estate sector, KPMG in India
Mr. Ravi S. Kochak
Former Additional Member (Production Units), Indian Railways
The finance minister maintained a commendable balance between the evenly stronger and mostly diverging compulsions of economic growth, fiscal discipline and political expediency.
Most of the budget provisions are inarguably aimed at ensuring inclusive growth, and bringing in equity in taxation and provisions.
A record number of measures have been introduced, to bring predictability, transparency and conciliation in the tax regime of the country.
It gives me a pleasure to present the summary and analysis of Union Budget 2016.
While you may have the snapshot, here is a document which will not only give you crisp highlights, but would also decode the impact of Budget 2016 on You, Your company and Your sector.
Hope you find this analysis useful in taking business decisions and align your company's strategy with over all economic climate for the upcoming financial year.
Would love to hear your feedback on the usefulness of the same.
Thanks a lot.
The Finance Minister presented the Union Budget on 1st February 2017. This is our analysis of the implications of the budget on the Indian Economy and the Markets. We have also shared the stocks that will be the Budget Winners & Losers. We hope you enjoy going through our analysis.
MARKET PULSE, the monthly from ACMIIL, aims to provide insightful perspectives on all aspects of the market, the equity, debt, derivatives,forex, commodities and money markets.
Impending Bankruptcy of Governments in IndiaShantanu Basu
Briefly discusses the precarious state of finances of governments in India that are reeling from burgeoning public debt and unhealthy state owned banks
INDIAN MANUFACTURING SECTOR NEED FOR A POSITIVE ENVIRONMENT FOR GROWTHNeha Sharma
The Indian Economy, the Government, the public at large and specially the people who are in industry, manufacturing sector, service sector or any other arena of business activity , all are deeply concerned with poor growth rate of manufacturing sector during last 2 to 3 years and specially in 2012-13.
India Budget 2012-13 - Analysis by Prabhu SrinivasanPrabhu Srinivasan
Budget 2012-13 has invited more criticisms than appreciations from the various stakeholders of the country. Given the unanticipated difficult situation the global markets are currently in, and the multiple problems that the Indian economy is facing, such as weakening of Rupee against US Dollars, High cost of funds, Inflationary pressures, and High unemployment levels to name a few, the finance ministry has opted for a stringent budget to defy these problems and bring the economy back on a sustainable growth path. I would like to conclude the analysis with my view that the key lies in implementation of the plans. Having observed in the past, that implementation of various initiatives have seen multiple road-blocks stalling them abruptly, we shall try to learn from our past to ensure growth and prosperity of the world’s largest democracy!
It gives me a pleasure to present the summary and analysis of Union Budget 2015.
While you may have the snapshot, here is a document which will not only give you crisp highlights, but would also decode the impact of Budget 2015 on You, Your company and Your sector.
Hope you find this analysis useful in taking business decisions and align your company's strategy with over all economic climate for the upcoming financial year.
Would love to hear your feedback on the usefulness of the same.
Aspirational, hurried and fretting
A plain reading of the budget papers, including the FM speech, makes us believe that the FM (and by implication PM) aspire to turn India into a truly egalitarian society as soon as possible but no later than 2024. Their posturing suggests that they are taking it for granted that there is no challenge to their leadership at least for next five years.
They appear in tremendous hurry to showcase all the arrows in their quivers, though most of these remain unsharpened.
The tone of the budget vividly shows that they are fretting about the gradual erosion in their support base and trying hard to make sure that this gradual erosion does not turn into an avalanche.
Dance of democracy or descent into mockocracyShantanu Basu
Briefly discusses the role of small parties that do not participate in elections in India but are errand boys of the larger ones in criminality like cash and drugs distribution during elections in India.
Briefly registers my protest against the proposed implementation of NYAYA by the Indian National Congress. It opposes the very idea of unsustainable cash handouts to the indigent.
Telecom Revolution, Governnace and Elections in IndiaShantanu Basu
Briefly discusses the telecom and media revolutions in India. The article concludes that a large part of voting in India's next General Election in 2019 would be decided from homes and that such choices would make voters much more conscious of seeking accountability of their elected representatives.
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
Empowering the Unbanked: The Vital Role of NBFCs in Promoting Financial Inclu...Vighnesh Shashtri
In India, financial inclusion remains a critical challenge, with a significant portion of the population still unbanked. Non-Banking Financial Companies (NBFCs) have emerged as key players in bridging this gap by providing financial services to those often overlooked by traditional banking institutions. This article delves into how NBFCs are fostering financial inclusion and empowering the unbanked.
where can I find a legit pi merchant onlineDOT TECH
Yes. This is very easy what you need is a recommendation from someone who has successfully traded pi coins before with a merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi network coins and resell them to Investors looking forward to hold thousands of pi coins before the open mainnet.
I will leave the telegram contact of my personal pi merchant to trade with
@Pi_vendor_247
What website can I sell pi coins securely.DOT TECH
Currently there are no website or exchange that allow buying or selling of pi coins..
But you can still easily sell pi coins, by reselling it to exchanges/crypto whales interested in holding thousands of pi coins before the mainnet launch.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and resell to these crypto whales and holders of pi..
This is because pi network is not doing any pre-sale. The only way exchanges can get pi is by buying from miners and pi merchants stands in between the miners and the exchanges.
How can I sell my pi coins?
Selling pi coins is really easy, but first you need to migrate to mainnet wallet before you can do that. I will leave the telegram contact of my personal pi merchant to trade with.
Tele-gram.
@Pi_vendor_247
If you are looking for a pi coin investor. Then look no further because I have the right one he is a pi vendor (he buy and resell to whales in China). I met him on a crypto conference and ever since I and my friends have sold more than 10k pi coins to him And he bought all and still want more. I will drop his telegram handle below just send him a message.
@Pi_vendor_247
Even tho Pi network is not listed on any exchange yet.
Buying/Selling or investing in pi network coins is highly possible through the help of vendors. You can buy from vendors[ buy directly from the pi network miners and resell it]. I will leave the telegram contact of my personal vendor.
@Pi_vendor_247
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
how to sell pi coins effectively (from 50 - 100k pi)DOT TECH
Anywhere in the world, including Africa, America, and Europe, you can sell Pi Network Coins online and receive cash through online payment options.
Pi has not yet been launched on any exchange because we are currently using the confined Mainnet. The planned launch date for Pi is June 28, 2026.
Reselling to investors who want to hold until the mainnet launch in 2026 is currently the sole way to sell.
Consequently, right now. All you need to do is select the right pi network provider.
Who is a pi merchant?
An individual who buys coins from miners on the pi network and resells them to investors hoping to hang onto them until the mainnet is launched is known as a pi merchant.
debuts.
I'll provide you the Telegram username
@Pi_vendor_247
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
The Evolution of Non-Banking Financial Companies (NBFCs) in India: Challenges...beulahfernandes8
Role in Financial System
NBFCs are critical in bridging the financial inclusion gap.
They provide specialized financial services that cater to segments often neglected by traditional banks.
Economic Impact
NBFCs contribute significantly to India's GDP.
They support sectors like micro, small, and medium enterprises (MSMEs), housing finance, and personal loans.
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
how can I sell pi coins after successfully completing KYCDOT TECH
Pi coins is not launched yet in any exchange 💱 this means it's not swappable, the current pi displaying on coin market cap is the iou version of pi. And you can learn all about that on my previous post.
RIGHT NOW THE ONLY WAY you can sell pi coins is through verified pi merchants. A pi merchant is someone who buys pi coins and resell them to exchanges and crypto whales. Looking forward to hold massive quantities of pi coins before the mainnet launch.
This is because pi network is not doing any pre-sale or ico offerings, the only way to get my coins is from buying from miners. So a merchant facilitates the transactions between the miners and these exchanges holding pi.
I and my friends has sold more than 6000 pi coins successfully with this method. I will be happy to share the contact of my personal pi merchant. The one i trade with, if you have your own merchant you can trade with them. For those who are new.
Message: @Pi_vendor_247 on telegram.
I wouldn't advise you selling all percentage of the pi coins. Leave at least a before so its a win win during open mainnet. Have a nice day pioneers ♥️
#kyc #mainnet #picoins #pi #sellpi #piwallet
#pinetwork
how can I sell pi coins after successfully completing KYC
Challenges in India's General Budget 2017-18
1. 1
Challenges for Budget 2017-18
Shantanu Basu
India’s General Budget 2017-18 will be interesting for several reasons. It would be a first for
two major reasons, viz. inclusion of Railway Estimates in the General Estimates, abolition of
the Plan and non-Plan distinction. How would each of these alter the complexion of the
Budget? Are these the only challenges?
Indian Railways (IR) presently runs operating ratios upward of 90%. This leaves precious
little for new capital works and extension, even less for maintenance, additions to rolling and
motive stock and accretion to reserves while deferred dividends would continue to multiply.
With general turndown in manufacturing activity, freight revenues would sag substantially.
For instance, declining demand from high-tension energy consumers has caused several
major coal-fired TPPs to back down. In turn, this is reflected in Coal India’s stagnant, even
declining, production figures. The same holds true for almost all other ores and equivalents
that account for perhaps half of IR’s freight earnings. Although global commodity prices
have taken a severe knocking and even anti-dumping duties are not too serious a deterrent,
yet with an overall decline in manufacturing activity, reduction in bulk imports will have
invariable negative fallout on IR’s freight revenue. At the same time, the commercial
exploitation of IR’s land and immovable assets has major limitations. For one, audit,
vigilance and investigation justifiably scare proposing officers. Second, much of such assets,
notably land, are located in areas where land prices are already low owing to lack of demand.
Encroachment over the decades has substantially reduced the price and availability even
more. On the passenger front, rapidly expanding budget and feeder airlines are steadily
gnawing at air-conditioned class travel. Volvo and long-distance sleeper buses offering
dynamic fares on point-to-point connectivity between passenger railheads would probably
add to the further diminution of IR’s revenues. Safety and comfort remain standing bugbears
for passengers. Inter-city bus services, run by states and private operators, have also been
steadily adding to their fleets and augmenting the number of daily services, something IR is
unlikely to be able to match. Clearly, all these will cast tremendous negative impacts on the
General Budget.
The second issue is a welcome step, having been proposed by the Dr. C. Rangarajan
Committee about five years ago. However, there are several grey areas, notably in
recognizing capital and revenue items that is governed mainly by the woolly distinction
between the two items laid out in Rule 79 of the General Financial Rules (GFRs), 2005.
Presently, there are several thousand project and contract posts that are funded from capital
funds and get carried over from project to project, oblivious of their often eternal timelines,
assuring lifetime career opportunities. Likewise, there are many revenue expenditure-based
projects, such as R&D ones, that include high-value project stores and several thousand
personnel that ought to be classified as capital expenditure but are not even though such R&D
projects/establishments work to create permanent assets for India. If the revenue-capital
divide is indeed genuinely enforced, shouldn’t government’s permanent assets be valued and
revalued every five years as well? After all these are national assets, aren’t they? In any case,
GFR 79 is adequately loosely worded to leave it open to convenient interpretation/re-
interpretation. How would the new classification change the way business is done in
government? Would it result in more capital expenditure? Past practice is not very
encouraging for a guide.
2. 2
However, there are other major challenges, far greater than the two issues above. Several
economic and policy factors may severely constrain public expenditure proposals in the
forthcoming budget. The deepening manufacturing crisis (including the real estate and
infrastructure sectors) would cast malevolent pressure on excise and other related revenues.
With large decline in business earnings by falling sales (such as the automotive sector by a
fourth), corporate taxation contribution in real terms would decline. Gradually reviving
global oil prices over 2014 levels are already casting pressure on oil PSU margins and will
reduce dividends available for transfer to Govt. of India. With manufacturing in the
doldrums, even non-oil PSUs are already hard-pressed to meet the rising demand for
unsustainable dividend from Govt. of India and by buy-back of govt. shares that would have
added to non-tax revenues of the govt. Coal companies, for instance, have been hit by the
backing down of many coal-fired power stations owing to low industrial consumer demand
and shift to alternative energy sources. The delay in implementing GST would only add, in
substantial measure, to the scarcity of government’s fiscal resources.
Public sector banks (PSBs) that have been assured Rs. 70000 crore over 2016-201 by the
Govt. of India, need manifold more for achieving Basel-IV norms of liquidity that is unlikely
to be available. At the same time, recovery suits are bogged in mostly understaffed Debt
Recovery Tribunals while the volume of NPAs is steadily rising. If corporate debt
restructuring (CDR) cases were added, the real volume of NPAs could potentially skyrocket.
Adding to these are giant public deposits arising from remonetisation on which banks would
have to fork out 4-5% interest per annum. At the same time, lowering of lending rates for
commercial borrowers seems to have limited takers owing to low consumer demand. In
effect, the banks would be saddled with idle funds on which 4-5% interest at least would be
payable. Any further rise in US Federal bank rates carry a potential backward migration of
foreign investments in India, particularly those that have no long-term moorings.
A major set of reasons for the scarcity of government funds is the overweening emphasis on
revenue generation by sale/lease of state/natural resources such as telecom spectrum and FM
stations. The entire process of public auction to the highest bidder is ruinous, indeed
antithetical, to the interest of the nation. Such assets are public properties to be devoted to the
common good. A deliberate decision of Govt. of India to arrive at a minimum reserve price
for spectrum, for instance, after factoring certain conditions, such as embargo on mobile
call/data tariff plans beyond 5% per annum, specified density/sq. km of mobile towers,
downtime/slow speed penalties, free Internet connectivity for educational and health
institutions, 50% tariff (of urban tariffs) for rural and semi-rural areas, etc. would have
pegged price of spectrum to more realistic levels as would a reverse price auction from such
benchmark. This would also have partly offset malfeasance in very large revenue-sharing
deals and made monitoring of contracts relatively easier. This was a major reason why the
recent spectrum auction was able to collect barely 10% of the targeted license fee and which
left a gaping hole in the Union’s projected finances by nearly Rs. 6 lakh crore. This plagued
the auction of FM stations too.
Adding to this web, are pending wage revisions, both in the public sector as also in states as a
cascading effect of the partial acceptance of the 7th Central Pay Commission’s
recommendations by the Govt. of India. Another major sector is the defence services that
need urgent upgrades in war materiel, technologies and provisions. Central and state police
forces too need proportionate upgrades. Even the Make-in-India programme for the defence
1 Ministry of Finance: INDRADHANUSH: PLAN FOR REVAMP OF PUBLIC SECTOR BANKS, Dept. of
Financial Services, Aug 14, 2015, p. 5 extracted on Jan. 25, 2017 from
http://financialservices.gov.in/PressnoteIndardhanush.pdf
3. 3
services would demand guaranteed defence purchase budget allocations and waiver of
competitive bidding for a private entrepreneur to invest several thousand crore Rupees in
captive manufacturing facilities for at least 20-25 years (like the Maruti-Suzuki ancillary
units in Gurugram in the 1980s and 1990s). The same would hold true of all sectors where
government purchases alone would sustain private manufacture. Budgetary uncertainties
would equally affect defence PSUs like GRSE, BEL, BDL, etc. that mostly live off
government-funded orders from the defence services, most so if they have to compete with
private manufacturers of military terrestrial transport and the like. In fact, the only way Make-
in-India may succeed is by a giant scale of operation, akin to the Chinese model, from where
it was evidently borrowed and given the Indian moniker.
The end result is that the total liabilities of the Govt. of India more than doubled from Rs.
31.59 lakh crore in 2008-09 to Rs. 66.89 lakh crore in 2015-162, and by 2013-14 constituted
46% of GDP general govt. liabilities (including states) rose to 65.30% of GDP while public
debt as a percentage of all liabilities rose to a whopping 87.30% and internal debt to 92.50%
of all public debt in 2014-15 with dated securities comprising Rs. 39.76 lakh crore nearly
double the 2010-110 figure of Rs. 21.57 lakh crore with an average weighted coupon rate of
about 8%. Although the average annual growth of liabilities has slowed to about 8% from
2012-13 to 2015-16, this is more a pointer to the severe limitations of continued government
borrowing and indebtedness to fuel its annual budget. Interest payments by the Govt. of India
have risen from Rs. 234022 crore in 2010-11 to Rs. 427011 crore in 2014-15, i.e. by 55%
cumulatively or by an average of 11% per annum that is commensurate with the rise in the
internal debt of the government as mentioned above3. Printing more fresh currency without
stoking inflation is not an alternative either.
RBI, commercial banks and insurance companies account for 70% of all dated securities in
2013-14. Although commercial banks are now flush with funds arising from remonetisation,
yet the omnipresent danger is that future govt. borrowings could actually end up as revenue
expenditure and contribute little to growth of GDP. With India’s GDP projected to fall by at
least a percentage in 2016-17 and 2017-18, the percentage of borrowings and repayments
would proportionately rise. Declining central revenues, delays in GST implementation, rising
cost of tax collection and future wave of tax litigation, etc., particularly in the post-
remonetisation phase, and severe limitations on raising taxes much further would adversely
impact states’ share of central taxes, leaving major across-the-board caps of 25-30% on
govt.’s revenue expenditure as one of the few mitigating factors. The challenges are
gargantuan and solutions not facile. Second-hand bargain hunting, vintage solutions and
accounting ingenuity are no longer options in circumstances that are not far less in magnitude
from the 1990-91 crises.
The author is a senior public policy analyst and commentator
2 Ministry of Finance: DEBT POSITION OF THE GOVERNMENT OF INDIA, extracted on Jan. 25, 2017
from http://indiabudget.nic.in/budget2015-2016/ub2015-16/rec/annex5.pdf
3 _______________; Ststus paper of Government Debt, dec., 2014 extracted on Jan. 25, 2017 from
http://finmin.nic.in/reports/govt_debt_2014.pdf