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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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Privilege motion against Union Minister Kiren Rijiju for calling Opposition MPs unworthy of House

The Union Minister said that if the Opposition cannot respect the chair, then they have no right to be a member of this House.

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Privilege Motion against Union Minister Kiren Rijiju for calling Opposition MPs unworthy of House

Sagarika Ghose, Trinamool Congress MP on Thursday moved a privilege motion against Union Minister Kiren Rijiju for calling opposition MPs unworthy of being in Rajya Sabha.

Reportedly, the notice was endorsed by 60 opposition MPs. This follows a day after Kiren Rijiju, speaking to opposition MPs in Rajya Sabha, said that they all are not worthy of being in this house.

Addressing the media, Trinamool MP Sagarika Ghose said that the Minister for Parliamentary Affairs, Kiren Rijiju, instead of doing his best to run Parliament smoothly, has chosen to repeatedly insult the opposition.

She added that Kiren Rijiju has insulted opposition members and used personal terms both inside and outside Parliament. She continued that this is totally unbecoming of the high office he holds and amounts to total misuse of his position.

In a privilege motion against Union Minister Kiren Rijiju, Trinamool MP accused him of misusing his office and using unparliamentary language against the opposition. Many senior leaders from all opposition parties have signed the motion, she added.

Earlier on Wednesday, Kiren Rijiju criticised opposition members, saying they were not worthy of being in the House. He further defended Vice President and Rajya Sabha Chairman Jagdeep Dhankhar, who has faced opposition attacks.

The Union Minister said that if the Opposition cannot respect the chair, then they have no right to be a member of this House.

Nearly sixty MPs from the opposition INDIA bloc on Tuesday submitted a notice in the Rajya Sabha for a no-confidence motion against Jagdeep Dhankhar. The Opposition accused him of being extremely partisan in his role as chairman of the Upper House.

In the no-confidence motion, Congress Chief Mallikarjun Kharge said that the Opposition have no personal enmity or political fight with him, but want to tell the countrymen that they have taken this step to safeguard democracy, the Constitution, and after giving it a lot of thought.

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Ahead of elections, Delhi government clears Rs 1000 per month for women, Arvind Kejriwal promise Rs 2100 if AAP wins

Arvind Kejriwal stated that previously he had promised to give Rs 1000 to every woman, but some women came to him and said that Rs 1,000 would not be sufficient due to inflation.

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Ahead of elections, Delhi government clears Rs 1000 per month for women, Arvind Kejriwal promise Rs 2100 if AAP wins

Ahead of the assembly elections, Aam Aadmi Party chief Arvind Kejriwal on Thursday announced that the Delhi cabinet has cleared a financial assistance proposal for women over the age of 18. He further announced that the assistance of Rs 1,000, originally announced in March, would be hiked to Rs 2,100 if the AAP wins. 

Arvind Kejriwal noted that the money would not be credited into bank accounts since elections were likely to be announced soon, but said that registrations for the scheme, named Mukhyamantri Mahila Samman Yojana, would begin tomorrow.

The former Delhi Chief Minister said that the registration will begin tomorrow, and the registrations will begin for Rs 2,100 and not Rs 1000. He made this announcement at Mahila Samman Yojana event where he was accompanied by Delhi Chief Minister Atishi.

Arvind Kejriwal stated that previously he had promised to give Rs 1000 to every woman, but some women came to him and said that Rs 1,000 would not be sufficient due to inflation. Therefore, Rs 2,100 will be deposited into the accounts of all women, he continued. Furthermore, the AAP national convenor said that the aforesaid proposal was passed in the cabinet meeting chaired by Atishi this morning, following which the scheme has been implemented.

In March 2024, the then Kejriwal-led Delhi government announced Rs 1,000 per month to all women above 18 years in the national capital under the Mukhyamantri Samman Yojna.

Notably, this initiative bore resemblances to Madhya Pradesh’s Ladli Behna Yojana, under which women from lower- and middle-class homes would receive a monthly transfer of Rs 1,000 into their accounts.

In his address today, Arvind Kejriwal said the scheme would prove to be a boon for the Delhi government as it will be blessed by mothers and sisters, benefitting from the monthly funding.

He also added that women build the future of the country, and they consider it their privilege to support them in their work. Along with Delhi’s two crore population, the government overcomes the biggest obstacles, he said, adding no obstacle can prevent them from doing good work for the people of the city.

Lashing out at the BJP, Arvind Kejriwal said that he first announced the scheme in March and hoped that it would be implemented at least by May. However, the BJP conspired and sent him to jail based on a fraud case. He added that since his return from jail, he has worked to implement this scheme with Atishi. 

Arvind Kejriwal was arrested by the Enforcement Directorate in March in connection to the Delhi liquor policy case. The former Chief Minister was released from Tihar Jail on September 13 after the Supreme Court granted him bail. Four days later, he resigned as the Delhi Chief Minister.

The elections to the 70-member Delhi Assembly are expected in January 2025. The AAP has so far released two lists of candidates to contest the election.

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Maharashtra CM Devendra Fadnavis meets PM Modi amid deadlock over cabinet portfolios

Devendra Fadnavis, Eknath Shinde, and Ajit Pawar agreed on a division of 22 ministerial berths for the BJP, 11 for Shiv Sena, and 10 for the NCP.

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Maharashtra Chief Minister Devendra Fadnavis met Prime Minister Narendra Modi in New Delhi on Thursday amid conundrum over cabinet portfolios. Almost three weeks after winning a majority in Maharashtra elections, the Mahayuti alliance is yet to decide on cabinet portfolios among the three alliance partners namely BJP, Shiv Sena and NCP.  

The meeting with the Prime Minister comes amid the three parties requesting the intervention of central BJP leaders to address remaining contentious issues. Earlier on Wednesday night, Fadnavis and his deputy Ajit Pawar held a meeting with Union Home Minister Amit Shah and BJP chief JP Nadda. Meanwhile, Deputy Chief Minister Eknath Shinde chose not to join the trip.

Reports said, Devendra Fadnavis, Eknath Shinde, and Ajit Pawar agreed on a division of 22 ministerial berths for the BJP, 11 for Shiv Sena, and 10 for the NCP. Notably, the maximum number of cabinet positions in Maharashtra, including the chief minister, is 43.

Nonetheless, the distribution of berths may still change. As per BJP leaders, if Shiv Sena and NCP request more positions, they will likely be assigned less significant portfolios. The major portfolios, including home and revenue, are expected to remain with the BJP. Reportedly, while Eknath Shinde had pushed for the home department, he has been given urban development, and the finance portfolio will go to the NCP.

The Shiv Sena initially argued that the election victory was achieved under Shinde’s leadership, insisting that he should remain Chief Minister. Nonetheless, the BJP stood firm, pushing for Fadnavis to hold the top position. Eknath Shinde had limited leverage, as the BJP only needed the NCP’s support to secure a majority. Notably, Shinde has always maintained publicly that he would not block government formation and took the oath as Deputy Chief Minister on December 5. 

However, Eknath Shinde’s current absence from the capital has raised questions in political circles, and it remains unclear whether he will join the discussions in Delhi.

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