Instead, govt will use ratio of govt debt-to-GDP as anchor for fiscal policy, Somanathan said. Historically, India has targeted fiscal deficit of 3% of GDP but failed to achieve it.
The target signals the government's intention to remain fiscally prudent despite expectations it may ramp up spending on welfare programs following a weaker than anticipated election victory for Modi.
With a favourable macro-fiscal backdrop, the finance minister can use the additional fiscal space to either hasten the path to consolidation or support the sectors with subdued growth.
Inclusion of Indian bonds on J.P. Morgan’s emerging markets index may lead to more foreign investment & lower borrowing cost. Dollar inflows could imply rupee appreciation & higher liquidity.
In actual terms, fiscal deficit was at Rs 16.53 lakh crore. According to data released by Comptroller General of India, govt managed to meet the revenue collection target.
IMF has found that countries going for polls tend to see significant slippages in fiscal targets. Analysis by ThePrint finds India has been bucking this trend over last 20 years.
In response to Kerala’s petition, Centre has said the state has performed worse than all-states average on all fiscal indicators, adding that its performance has worsened over time.
With tax revenue not doing as well as needed, govt has few choices before it: reduce subsidy-led revenue expenditure, cut back on growth-oriented capex, or miss its fiscal deficit target.
Capital expenditure of 23 states grew by 52% in April-September 2023 over same period last yr, but discontinuation of GST compensation, tapering of grants could weigh down some states.
Ratings agency kept India’s rating & outlook unchanged, citing Indian economy’s growth, banking success on the one hand versus high debt, fiscal deficit and interest payments on the other.
Pakistan failed to understand the fiercely independent psyche of the Afghans and Pashtun nationalism, which has dominated politics in Afghanistan since its emergence in 1747.
Tajikistan did not want to extend the lease because of apparent pressure from Russia & China over non-regional military personnel at the air base, it is learnt.
On 21 Oct, a buzz went up that the govt had released full list of gallantry award recipients along with Op Sindoor citations. I put an AI caddy on the job. It took me into a never-ending rabbit hole.
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