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H I G H L I G H T S

  • Five years after, GST compensation issue remains unresolved     
  • Rupee depreciation continues, RBI uses forex reserves
  • GDP growth 8.7 % in 2021-22, but will be lower in 2022-23
  • Tax revenues buoyant, but slippage in deficit target unavoidable
  • Finance Ministry report raises concerns over likely twin deficits
  • Higher expenditure outlays create fresh burden for govt finances
  • RBI hikes repo rate again, set to miss inflation target
  • Govt responds to unemployment fears, announces mor
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H I G H L I G H T S

  • RBI Annual Report offers different strokes on economy     
  • Lower RBI dividend for Govt as provisions see a five-fold rise
  • Falling circulation of currency notes of Rs 2000 denomination​​​​​​
  • Headwind for privatisation as proposals run into trouble
  • Disinvestment receipts look up, set to exceed 2022-23 target
  • Inflation on a rising spree, while industrial growth stays feeble
  • High inflation spurs RBI on a monetary policy action overdrive
  • Reducing liquidity and setting a goal of p
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H I G H L I G H T S

  • Gross tax collections bonanza for the Centre in 2021-22      
  • Pleasant surprise on revenue from direct and indirect taxes​​​​​​​
  • Better planning and forecasting on tax collections​​​​​​
  • Conservative revenue planning for 2022-23 stands in good stead
  • No cheer from growth and inflation forecast for India
  • Relief from IMD’s normal monsoon forecast in 2022 
  • RBI revises outlook: Lower growth and higher inflation
  • No increase in interest rates for now; subtle change in stance​​​​​​
  • S
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H I G H L I G H T S

•         Exports touch a new high      
•         FDI inflows decelerate
•         Indian economy faces headwinds
•         Inflation scenario looks grim
•         Pressure on Centre’s deficit
•         Retail oil price strategy 
•         Moves on bank privatisation
•         Tax collections buoyant

Exports touch a new high
 
Almost a decade ago, India’s merchandise goods exports had crossed the $300 billion mark. That was in 2011-12. In the last ten years,  the performance

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H I G H L I G H T S

•         India’s oil sector policy hit by Russia-Ukraine conflict      
•         Retail inflation management would cause concern
•         Govt choices limited as agri-commodities prices will go up
•         Impact on government finances may be manageable
•         Question mark over consumer spending and pace of recovery
•         Real estate, construction, cement to be hit by higher prices
•         RBI monetary policy maintains stance with no rate hike
•         Move tow

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Special Report on Budget 2022

H I G H L I G H T S

• Surprises galore in the fiscal mathematics of Budget 2022
• Marginal fiscal slippage
• A few imponderables
• Focus on fiscal consolidation
• No respite from debt overhang
• Higher interest burden choking expenditure
• Transparency in Budget accounting
• Growth assumptions puzzling
• Tax revenue growth underestimated
• Tax revenue next year may be a pleasant surprise
• Realism in disinvestment receipts
• Lack of clarity on privatisation
• Capex rise helped by loans to states

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H I G H L I G H T S

•         First print of 2021-22 GDP out, many more to come       
•         Significant variations in six versions of the GDP data
•         GDP growth in 2021-22 to help project Budget numbers
•         Low demand continues to be a cause for concern
•         GST collections on the rise, but there are caveats
•         GST collections’ share in GDP sees no recovery
•         Nominal growth in 2021-22 may not be enough to help GST
•         Double whammy from industrial outp

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H I G H L I G H T S

•         Winter Parliament session gives key economic bills a miss       
•         Farm laws repealed and electoral laws amended
•         No change in RBI policy stance & benchmark interest rates
•         Effective hike in reverse repo rate through an indirect route
•         Growth projection retained at 9.5%, Omicron notwithstanding
•         Inflation projected to stay below the upper tolerance band
•         New policy to strengthen prudential norms for NBFCs 
•     

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H I G H L I G H T S

•     Indian economy recovers, but its size still at 2019 level
•     No nod yet for entry of industrial houses into banking
•     Privatisation bill holds the clue to corporate ownership of banks
•     Bank privatisation not going to be a one-shot affair
•     Promoters allowed to hold higher equity stake in banks
•     Fertility rate drops, need for bigger socio-economic policy push
•     Farm laws repealed, new challenges on minimum support price
•     Some clar

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H I G H L I G H T S

•     Robust tax revenue boosts Govt finances in 1st half of 2021-22
•     Only worry on revenue front caused by poor disinvestment
•     Exports maintain robust growth in first half of 2021-22
•     Imports up at a higher pace, widening the trade deficit
•     Air India privatised, returns to the Tatas after 68 years
•     What Tatas paid out to acquire Air India
•     Govt sheds Air India, but carries a lot of its past debt
•     Growth outlook brightens, Indi

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H I G H L I G H T S

•     Higher tax revenues swell Govt coffers, but no relief for deficit yet
•     Relief for telecom sector: Will players bite the tariff bullet?
•     Retail Inflation moderates, no relief from wholesale prices
•     Foreign trade buoyant, with exports rising in August
•     Industrial output up, riding on manufacturing
•     Bumper kharif crop expected, though sowing marginally lower
•     Wealth inequality wider than income disparity

Higher tax revenues swell Govt coffers

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H I G H L I G H T S

•     GDP up 20% in Q1 2021-22; its real size lower than Q1 2019-20
•     National Monetization Plan ambitious, raises questions
•     Push for new infrastructure scheme, ambivalence on privatization
•     Scrappage policy to boost auto sales, curb vehicular pollution
•     RBI monetary policy maintains status quo, bats for growth
•     Different strokes from Monetary Policy Committee members
•     Exports spurt in July, showing growth for eighth month running
•     Wholesale

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H I G H L I G H T S

•     Government finances better with higher tax revenues
•     Poor disinvestment and slow capex rise cause for concern
•     Delicensing power distribution part of big legislative agenda
•     Implementing power distribution reform key to its success
•     New law to pave the way for general insurance privatisation 
•     IBC tweaked to allow pre-pack resolution of stressed MSMEs 
•     Easier access to insured deposits in banks facing moratorium
•     Mining law change to

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H I G H L I G H T S

•  Indian economy’s contraction in 2020-21 revised down
•  April-June 2020 saw India’s worst decline in economic output
•  Agriculture bucked the overall decline in many sectors
•  Construction led the recovery from third quarter 
•  Services remained in contraction mode for the whole of 2020-21
•  Growth forecast for 2021-22 lowered by World Bank, RBI   
•  Sharp variations in Govt’s tax revenue estimates
•  Actual tax revenues fell 10-12 % over RE in 2018-19 & 2019-20
•  Ac

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•  Growth prospects take a hit after 2nd wave of COVID-19
•  Finance Ministry plays down the overall impact on economy
•  RBI rolls out package to address concerns over COVID-19
•  Fillip to bond buying programme to help soften yields 
•  Loan restructuring move to help stressed MSMEs
•  False cheer on industrial growth, real concern on inflation  
•  Automobile sales mask deeper industry-wide problems
•  Good tidings on GST collections in April
•  E-way bills generation shows worrying trend
•  

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H I G H L I G H T S

•  Growth prospects take a hit after 2nd wave of COVID-19
•  Finance Ministry plays down the overall impact on economy
•  RBI rolls out package to address concerns over COVID-19
•  Fillip to bond buying programme to help soften yields 
•  Loan restructuring move to help stressed MSMEs
•  False cheer on industrial growth, real concern on inflation  
•  Automobile sales mask deeper industry-wide problems
•  Good tidings on GST collections in April
•  E-way bills generation show

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H I G H L I G H T S

•  Economic growth prospects for 2021-22 take a hit
•  Inflation concerns may worsen, impacting RBI’s options
•  Second Covid wave sees fewer curbs on economic activity
•  A shift in the vaccination strategy; states to do heavy lifting
•  New strategy reduces Central spend on vaccines
•  Maruti exudes optimism on car sales
​​​​​•  Automobile sales back to where they were in 2015
•  Industrial output falls; consumer durables buck trend
•  Positive surprise on Centre’s tax coll

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H I G H L I G H T S

•  A lower fiscal deficit for 2020-21, thanks to higher tax revenues
•  March pick-up in exports helps reduce full year’s trade gap
•  GST collections recovery reflects improved procedures
•  No change in inflation targeting regime, but prices up
•  Economy tracker: Covid surge shows a deceleration in activity
•  Three relaxations that impacted India Inc and banks
​​​​​•  Extending deadline on e-mandate on recurring payments 
•  Enforcement of Labour Code deferred, ball in st

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H I G H L I G H T S

•  Mixed picture on growth, worries on fourth quarter numbers
•  RBI Report hints at maintaining existing inflation targets
•  No rate cut, but bond market spikes worry RBI 
•  Retail inflation down, industrial output up
•  Trade data offers relief as domestic demand improves
•  PM batting for private enterprise, sets a new benchmark

 

Mixed picture on growth, worries on fourth quarter numbers

The news on the growth front was mixed as evident from the latest data released by

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H I G H L I G H T S

• Union Budget for 2021-22: An Assessment
• Using a fiscal crisis to lend greater transparency 
• No increase in revenue spend, but a big boost to capex
• Stability in direct taxes, but Customs review worrying
• Big reforms announced; implementation will be the key
• Privatisation and asset sale to raise resources
• Higher FDI & foreign ownership in insurance allowed
• Legislative reforms for ease of doing business
• Idea of a bad bank makes its debut; DFI makes a comeback

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About the Author

A K Bhattacharya
Distinguished Fellow, Ananta Centre
Editorial Director, Business Standard

After a 10-year long stint with Financial Express from 1978-1988, in different capacities in the areas of news gathering and news management, A.K. Bhattacharya joined The Economic Times in 1988 and functioned as its Chief of Bureau from 1990 to 1993. In 1994, he became its Associate Editor. He joined The Pioneer as Executive Editor in September 1994, stabilised the newspaper before becoming its Editor in 1995. He joined Business Standard in 1996 as Editor, News Services. Was its Resident Editor in Mumbai from July 1996 to September 1997 and helped the newspaper launch its Mumbai edition. From October 1997 to May 1998, he functioned as National Editor leading the paper's news operations. As Managing Editor of Business Standard between June 1998 and April 2000 and as its Group Managing Editor between May 2000 and October 2011, he oversaw the newspaper's news operations and editorial administration. From November 2011 to July 2016, he was the Editor of Business Standard. Since August 2016, he has been the Editorial Director of Business Standard on a part-time basis. He has been writing a regular column - New Delhi Diary - commenting on government affairs, since 1990 - that appeared in The Economic Times, Pioneer and now in Business Standard. Since 1997, he has been writing another column - Raisina Hill - commenting on developments/issues concerning bureaucracy.