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Economic Survey seems to have its head in the sand under storm clouds

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Economic Survey seems to have its head in the sand under storm clouds

GDP growth projection of 7-7.5 percent probably seems too optimistic

The Economic Survey 2018 projects 7-7.5 per cent growth rate in 2018-19, up from 6.75 per cent in the current fiscal, making India once again the world’s fastest growing major economy.

The forecast, that comes within an environment of slow and jobless growth, says the economy will grow on the back of major reforms which would be strengthened further in the next financial year.

“A series of major reforms undertaken over the past year will allow real GDP growth to reach 6.75 per cent this fiscal and will rise to 7 to 7.5 per cent in 2018-19, thereby re- instating India as the world’s fastest growing major economy,” it says.

The survey points out that India can be rated as among the best performing economies in the world as the average growth during last three years is around 4 percentage points higher than global growth and nearly 3 percentage points higher than that of emerging market and developing economies.

It says that the GDP growth has averaged 7.3 per cent from 2014-15 to 2017-18, which is the highest among the major economies of the world.

“That this growth has been achieved in a milieu of lower inflation, improved current account balance and notable reduction in the fiscal deficit to GDP ratio makes it all the more creditable,” it says.

The survey says that after the preliminary analysis of Goods and Services Tax (GST) data, there has been a 50 per cent jump in the number of indirect taxpayers and a huge increase in voluntary registrations, particularly by small enterprises. The number of individual income tax filers increased by over 18 lakh since November 2016 the month when demonetisation was implemented.

As for the optimistic projections of growth rate, if the survey had taken into consideration of the sharply spiking fuel prices, then, possibly, a change of heart would have occurred. On the other hand, since petroleum is still beyond the scope of GST, higher collection from taxes remains a possibility despite shooting oil prices. That might hot, however, translate into higher GDP growth.

What will be difficult to achieve in this scenario would be fiscal discipline and the deficit could well travel beyond control. And, when the resource pool for buying oil grows, even a small appreciation in the value of the Rupee could have major adverse effects at home.

Much of the survey’s optimism stems from an expectation of higher export. That may be so, but if the Rupee has appreciated against the accepted basket of foreign currencies, it will cancel out the positivity and we could well be standing pretty much where we started.

Before going any further, we need to read the substance of the survey which states that growth is on track, revenue collection is on the rise – it has to be remembered that this is the first survey and first Union Budget after the implementation of GST – and fiscal deficit was under reasonable check.

The survey also sees growth in private investment, the hallmark of any growing economy in the next fiscal while also adding flesh to government initiatives in the education and agriculture.

Apart from the fact that this survey’s forecast runs in the face of the government’s own advance GDP data as was available this month – that expected the economy to grow at a four-year low of 6.5 percent in the current fiscal, mainly due to the poor performance of agriculture and manufacturing sector, against last fiscal’s 7.1 percent – it is possibly avoiding this confrontation, especially with jumping fuel prices barking at its feet.

The fiscal deficit target of the government for this fiscal was 3.2 percent of GDP against 3.5 percent in 2016-17, but it is well known that with the elections progressing and things not looking too good, finance minister Arun Jaitley may be forced to take a populist stance, in which case the fiscal deficit target can only be relaxed, with discipline given a go-by.

The projections here, therefore, would taste better with a pinch of salt.

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Jammu and Kashmir: CRPF vans damaged, stones hurled amid protests against Vaishno Devi ropeway project

The residents have been complaining that the project would negatively impact the environment and their livelihoods.

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Jammu and Kashmir: CRPF vans damaged, stones hurled amid protests against Vaishno Devi ropeway project

Massive violence broke out in Jammu and Kashmir’s Katra after the protestors pelted stones and clashed with the security forces during their protests against the proposed ropeway project along the trek route to the holy shrine of Vaishno Devi atop Trikuta hills. 

Reports said that the protestors hurled stones at the security personnel and damaged a CRPF vehicle. Paramvir Singh, Reasi SSP told media that the protest was going on peacefully for the past three days but on Monday some protesters pelted stones at the security forces. 

In Jammu and Kashmir’s Katra, the shopkeepers and labourers on Sunday took out a protest rally on the third day of their strike and held a sit-in outside the office of the subdivisional magistrate and Shalimar Park in Katra, the base camp for pilgrims visiting the shrine. 

A member of the joint committee of shopkeepers and pony and palanquin owners had said that the 72-hour strike has been extended by another 24 hours, adding that they will meet again and announce our future course of action. Notably, the three-day strike called by them began on Friday. 

Reports stated that while the businesses located at the base camp of Katra remained operational, shops lining the pilgrimage route from Ban Ganga to Charan Paduka observed closures. Nonetheless, the suspension of pony and palanquin services is causing hardships for the pilgrims, especially the elderly and differently-abled, to continue their sacred journey.

The residents have been complaining that the project would negatively impact the environment and their livelihoods. They asserted that the ropeway project would render them jobless, and also accused the authorities of pushing through the development without adequate consultation.

Meanwhile, Jammu and Kashmir Lieutenant Governor Manoj Sinha has assured the protestors of their employment. He mentioned that the committee headed by the Divisional Commissioner has been deliberating on the ropeway project and the rehabilitation of the locals. Furthermore, he also emphasised that the genuine concerns of the locals would be considered while the development of the region would not be ignored.

The Shri Mata Vaishno Devi Shrine Board (SMVDSB) had announced implementation of the long-awaited ropeway project to facilitate a safer and faster journey for the pilgrims. As per the project details, the ropeway will be developed with a cost of Rs 250 crore between Tarakote Marg to Sanji Chhat along the 12-kilometre track.

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Delhi Pollution: GRAP IV restrictions to continue in national capital, says Supreme Court

The court also pulled up the Delhi Police over no checkpoints at the borders of the city for checking the pollution measures and said that it was a serious lapse.

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Delhi Pollution: GRAP IV restrictions to continue in national capital, says Supreme Court

The Supreme Court on Monday refused to relax GRAP IV measures in Delhi and ordered the CAQM to consider relaxing norms for students. The apex court observed that several students cannot avail midday meals, online classes and cannot access air purifiers.

The court also pulled up the Delhi Police over no checkpoints at the borders of the city for checking the pollution measures and said that it was a serious lapse. A bench headed by Justice AS Oka stated that they would consider prosecution of the Delhi Police Commissioner under the Commission for Air Quality Management (CAQM) Act for deploying police personnel at only 23 checkpoints, when Stage 4 of the GRAP was implemented.

Earlier, the court has also appointed 13 members from the court as commissioners to check whether the GRAP IV measures are being implemented or not. On Monday, the commissioners submitted their report to the court.

Subsequently, the court told the Delhi government that there were no checkposts at borders of the city and that the ban on trucks entering into the capital was not being followed properly.

The top court bench said that they were informed that no police or government personnel were present at the border checkpoints, and they were only manned by toll collection staff of the Municipal Corporation of Delhi. Mentioning that they will direct prosecution against all officials, the court questioned why the police were not directed to take action under Stage IV of the GRAP.

Responding, Advocate Shadan Farasat representing the Delhi government said that the CAQM had issued directions. Consecutively, the court asked him to show what written instructions were given by the state and the central government to the police on November 18. To this, Advocate Farasat said that directions were issued to post police personnel at 23 checkpoints where trucks could enter the city.

The court continued that this was negligence, adding that it will direct CAQM to prosecute the Delhi Police Commissioner.

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Maharashtra elections: Ajit Pawar criticises Sharad Pawar’s decision to field Yugender Pawar against him

Ajit Pawar said that Yugendra is a business person, and he had no connection with politics.

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Maharashtra elections: Ajit Pawar criticises Sharad Pawar’s decision to field Yugender Pawar against him

After the Maharashtra Assembly Elections results, NCP leader Ajit Pawar criticized NCP faction led by Sharad Pawar for its decision to field his nephew Yugender Pawar against him in the family bastion of Baramati. Ajit Pawar also mentioned that his decision to field wife Sunetra Pawar against his sister Supriya Sule in the Lok Sabha election was a mistake. 

Sharad Pawar led NCP had fielded Yugender Pawar, son of Ajit Pawar’s elder brother Shrinivas Anantrao Pawar, in the Baramati Assembly segment. The constituency was represented by Sharad Pawar for over two decades, followed by Ajit Pawar for over three. In this assembly election, 33-year-old Yugendra Pawar was backed by Sharad Pawar and four-time Baramati MP Supriya Sule. However, Yugender Pawar lost out against his formidable uncle by a margin of over 1 lakh votes.

While addressing the media, Ajit Pawar said that Yugendra is a business person, and he had no connection with politics. He added that there was no reason to field his own nephew against him in the elections.

Earlier in the Lok Sabha elections 2024, Ajit Pawar had fielded his wife Sunetra Pawar against his cousin and Sharad Pawar’s daughter Supriya Sule, who won the contest by a 1.5 lakh votes margin. Later, Ajit Pawar admitted that it was a mistake.

Sharad Pawar had defended the decision to field Yugendra Pawar, mentioning that someone had to contest the polls. He had also said there was no comparison between Ajit Pawar and Yugendra Pawar. 

Notably, a 2023 rebellion led by Ajit Pawar against his uncle split the NCP founded by Sharad Pawar. Since then, the senior Pawar has been fighting to win his party’s name and symbol back. 

Previously In the Lok Sabha election, the veteran had trumped his nephew, with his faction winning 8 seats compared to Ajit Pawar’s score of 1. However this time, the tables turned as NCP (Sharad Pawar) scored 10, but Ajit Pawar’s party won 41.

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