In the midst of economic gloom everywhere, Finance Minister Arun Jaitley today announced the economic survey for 2016 which projects an excellent picture of India’s economic future.
But is it a proverbial silver lining?
Here we present the major highlights from economic survey 2016:
- India’s economic growth is pegged between 7 and 7.5% for 2016. Financial year starts from April 1st, 2016
- For 2015-16, fiscal deficit of 3.9% of GDP was estimated, which seems achievable as of now
- Fiscal deficit amounting to 3.5% of GDP is being targeted for 2016-17
- CPI Inflation is being targeted between 4.5 to 5% in 2016-17
- Confidence in price stability has become stronger; low inflation is now holding
- Account deficit targeted at 1-1.5% of GDP
- Fair value of rupee can be achieved by monetary relaxation
- In case capital inflows are weak, we can allow weakening of rupee
- Indian market needs to be prepared for massive readjustment of currency in Asia, as a similar phenomenon shall be happening in China soon
- Banks need Rs 1.8 trillion as capital for 2017-18
- Rs 700 billion shall be provided to banks in current and succeeding years as budgetary allocation
- Government is expected to sell-off certain non-financial institutions to bring in capital for state-run banks
- Tax revenues are expected to be higher than budgeted levels of 2015-16
- Government will attempt to expand tax net to 20% of earning individuals from 5% currently.
- Some tax exemptions shall be removed to increase tax revenue
- Entrepreneurs would be provided more soaps as entry and exit procedure shall be eased
- GST is expected to be rolled out indicating major reforms