Author: India Writes Network

Budget 2015 reactions: Clear Vision, Making India story shine

- by India Writes Network

The maiden budget presented India’s Finance Minister Arun Jaitley on February 28 has elicited a largely positive response from leading politicians, industrialists and global investors. Prime Minister Narendra Modi described Budget 2015 as “a Budget with a clear vision.” “It is a Budget that is progressive, positive, practical, pragmatic & prudent,” he said. Mr Jaitely said that it’s time for India to fly. Can India fly? Here are a spectrum of reactions on India’s Budget 2015:
Rajnath Singh, Home Minister: “It will play an important role in the formation of modern India and it will help eliminate poverty and unemployment.”
Mallikarjun Kharge, Congress: “It is just a vision document, a Budget in interest of corporates and industrialists.”

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Budget 2015: It’s time for India to fly, new steps to rev up economy

- by India Writes Network

With the “world predicting that it is India’s chance to fly,” India’s Finance Minister Arun Jaitley unveiled his first full-spectrum budget that seeks to make India a manufacturing hub and announced a host of policy changes and targets to revitalise Asia’s third largest economy. These include the reduction of corporate tax from 30% to 25% over the next four years, visa on arrival to 150 countries, 46,727 crore (around $8 billion) increase in defence spending, a comprehensive new law to bring back black money stashed abroad, and the setting up of new IIT, IIMs, AIIMS.
Underlining that India is going to take off on a faster growth trajectory, Mr Jaitely presented a robust picture of the India growth story in months to come. “While global growth forecasts have come down, India’s forecasts have either been maintained or scaled up,” Mr Jaitley said in his Budget speech on February 28.
Mr Jaitely reinforced his government’s commitment to greater fiscal consolidation, saying that he will be able to meet the stated 4.1 per cent fiscal deficit target for the current fiscal year.

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India’s economy to grow at 8 per cent, room for big-bang reforms

- by India Writes Network

Conjuring up a bright picture for the India growth story, the Indian government has projected that the country’s economy will grow at a rate of more than 8 per cent in the 2015-16 fiscal year, while consumer inflation will drop to between 5 and 5.5 per cent.
The Economic Survey report, which was tabled on February 27 in parliament by India’s Finance Minister Arun Jaitley, a day before the NDA-led BJP government’s first full Union Budget, forecast that the Indian economy would grow by 8.1-8.5 per cent under a new calculation method that makes India the world’s fastest growing large economy.
The survey, a big-picture report on the state of Indian economy, also indicated that India can increase public investments and still achieve its borrowing targets.
The survey is clear about the government’s priorities: India needs to stick to its medium-term fiscal deficit target of 3 percent of gross domestic product.

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Mamata’s Dhaka visit sets tone for Modi visit

- by India Writes Network

Boosting further the relations between India and Bangladesh, West Bengal Chief Minister Mamata Banerjee undertook a three-day visit to the neighbouring country from February 19. The visit was at the invitation of Bangladeshi Foreign Minister AH Mohmood Ali to participate in the celebration of Bhasha Divash (International Language Day) on February 21. The visit ended successfully, reinforcing the warmth between the two countries.

Mamata Banerjee’s visit was important for many reasons. West Bengal shares around 2000 km, out of the total 4098km, of the border that India has with Bangladesh. This is the longest border that any of the Indian States have with Bangladesh. With such a long border, the relation between the countries greatly depend on the attitude of the bordering States have towards Bangladesh. Cooperation of the bordering States is important for developing the bilateral relations between the two countries. The sharing of the water of the intra-State river Teesta is a good example. In spite of the positive political will, India and Bangladesh could not sign the water sharing agreement during former Indian Prime Minister Dr Manmohan Singh’s visit to Dhaka in 2011 because of the objection of the agreed draft agreement by Mamata Banerjee.

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PM needs to focus on infrastructure for growth

- by India Writes Network

While India is one of the fastest growing economies in the worldtoday, a major obstacle for sustaining its real GDP growth has been the lack of adequate infrastructure, which can support the growth process. Low levels of public investment have made India’s physical infrastructure incompatible and without improving the rate of infrastructure investment, the overall growth rate would remain modest. Therefore, there has been a growing emphasis by the Government of India to mobilise infrastructure investments to the tune of$1 trillion during the 12th plan (2012-17) across sectors such as roads, railways, seaports, airports, power, telecom, water and irrigation of which 50% is expected to come from the private sector in the form of both debt and equity. However, there is a realisation that expecting private sector to contribute nearly 50 per cent to the total infrastructure deficit is a stiff ask given that there are lack of bankable projects and mistrust between the private and government sector.

The 11th FYP had projected investment requirements in infrastructure to be about $514 billion. This target was doubled in the 12th FYP to nearly $ 1 trillion highlighting that GDP growth averaging 9% per year can be achieved only if this infrastructure deficit can be overcome. It was opined that domestic savings can contribute significantly to boosting infrastructure investment. However these savings have to be intermediated into infrastructure to achieve these targets.

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