BALANCING THE NEEDS: 15th FC
The interim report of 15th FC has left some uncomfortable issues unanswered, which need to be resolved First Under the current arrangement, states were supposed to be compensated for any shortfall in their GST collections for a five-year period. Lack of clarity about Centre’s obligation to compensate states if collections from the compensation cess fall […]
SHUNNING FISCAL ADVENTURISM
In the run-up to the budget, there was enormous pressure on the finance minister to launch a fiscal stimulus so as to pump-prime the economy There is already considerable stimulus in the system. The finance minister took a step towards transparency by admitting to off-balance sheet borrowings of 0.8 per cent of GDP for both […]
LOWER RATE OF EPF SUBSCRIPTION WITH EPFO NOTIFIED
Why in news? The reduction in statutory rate of contributions from 12% to 10% for wage months May, 2020, June, 2020 and July, 2020 for all class of establishments covered under the EPF & MP Act, 1952 was announced on 13th May 2020. Details The above reduction of rate of contribution is not applicable to establishments like Central and State […]
THE HIGH COST OF RAISING TRADE WALLS
Finance Minister in her Budget speech said that, imports under Free Trade Agreements (FTAs) are on the rise. Undue claims of FTA benefits have posed threat to domestic industry. Such imports require stringent checks,” adding that the government will ensure that all FTAs “are aligned to the conscious direction of our policy”. The case of […]
AIMING A BILLION TRANSACTIONS A DAY: DAWN OF DIGITAL PAYMENT
Digital payment transactions on the Universal Payment Interface (UPI) platform rising from 0.1 million in October 2016 to 1.3 billion in January 2020 represents the magic of entrepreneurs, nonprofits and policymakers working together India was long a financially excluded nation — only 17 per cent of Indians had a bank account in 2011 The World […]
FASHIONING THE FRAMEWORK OF A NEW INDIA
Why in news? The Indian economy is going through a severe crisis: a slowdown as well as a structural crisis. In the words of the former Chief Economic Adviser, Arvind Subramanian, it is headed towards the ICU. Almost all sectors of the economy are in decline: the rate of growth of the national GDP has […]
A NUTRITION RICH INDIA CAN DO MORE, AND DO IT BETTER
Context: The wasting of millions of young children, owing to malnutrition, is a key imbalance Details: The next decade is going to be decisive to irrevocably rid ourselves of deficiencies One critical imbalance to eliminate is that of inequalities of opportunity Due to malnutrition- we are wasting of millions of our young children and the inability […]
CONTINUITY AND FISCAL FOLLOW THROUGH: 15TH FINANCE COMMISSION’S INTERNIM REPORT
Why in news? The appointment of the Fifteenth Finance Commission by the President of India under Article 280 of the Constitution was notified on November 27, 2017. It was required to submit the report by October 30, 2019 for five years for the period 2020-21 to 2024-25 Notifications were issued first, on July 27 extending […]
FALLING SHORT OF ASPIRATIONS
Why in news? Expectations from the Union Budget 2020 was that it would reverse the falling growth rate, reduce unemployment and rekindle the animal spirits needed to revive private investment. Bonds and startups The fundamental problem of infrastructure finance is the asset-liability mismatch which can be addressed only by developing a vibrant ‘corporate bond market. […]
COGNIZANT OF CONSTRAINTS
Why in news? he interim report of the 15th Finance Commission, tabled in Parliament on Saturday, has largely preserved the devolution mathematics of its predecessor, belying concerns of a sizeable cut in States’ share What has the commission said? The commission has recommended a one percentage point reduction in the vertical split of the divisible pool of […]