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Samiran Chakraborty
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Fiscal consolidation, with a reform vision

Budget 2024 balances the need to spur economic growth with the need to signal commitment to fiscal prudence

Noida, India- July 23, 2024: People watching the live telecast of Union Budget 2024, at a shop in Sector 51. Finance Minister Nirmala Sitharaman presented Union Budget of the Modi government, in Noida, India, on Tuesday, July 23, 2024. (Photo by Sunil Ghosh / Hindustan Times)
Published on Jul 25, 2024 09:05 PM IST

Adding arrows to new regime’s policy quiver

An economy which is performing several steps ahead of its peers, does not need an overhauling of the policy framework.

As we neared the end of 2022-23, there was near-consensus on real growth. The cited figure was between 6.8 and 7%. There is less consensus for 2023-24 and the medium-term. An optimist will say 6.5%, a pessimist 5.5%. An enthusiastic optimist will place it at 7%, a dire pessimist at 5%. While that’s a fairly broad band, there is no denying the Indian economy’s growth resilience. (Shutterstock)
Published on Jun 10, 2024 01:28 AM IST

Monetary policy has an inflation dilemma

Faced with low core inflation and high food inflation, RBI will likely tilt towards a longer disinflationary stance, to achieve the 4% CPI rate

India’s recent inflation has been a tale of two prices. Food inflation remains elevated at 7.6% but core inflation has dropped sharply to 3.6% in January 2024
Published on Feb 26, 2024 12:10 PM IST

Building the backdrop for lower interest rates

Focus on fiscal consolidation, moderate capex push and eschewed pre-election populism define the interim budget

New Delhi, India - Feb. 1, 2024: Nirmala Sitharaman, Union Minister of Finance along with Bhagwat Karad and Pankaj Chaudhary MOS Finance leaves the Finance Ministry carrying the Finance Budget ahead of the presentation of interim Budget 2024 in Parliament at North Block in New Delhi, India, on Thursday, February 1, 2024. (Photo by Sanchit Khanna/ Hindustan Times)(Hindustan Times)
Published on Feb 05, 2024 08:00 AM IST

Is there more room for competitive populism?

Higher than expected tax revenues provide a cushion for the government. However, concerns remain about the medium-term fiscal deficit

Competitive populism seems to have taken centrestage with not much discussion about its fiscal ramifications(HT Archive)
Published on Nov 15, 2023 10:51 PM IST

Inflation fears throw up policy dilemmas

Several interventions are being tried to cool prices but different measures might have conflicting impacts. Instead, a nimble, vigilant balance is preferable

 Tomatoes may have hogged the recent headlines, but the recent vegetable price rise is broad-based (PTI)
Published on Aug 29, 2023 12:26 AM IST

Modest MSP hike is a tightrope act by govt

MSPs for kharif season are the highest in the last five years, but lower than prior pre-general election years, underlining the Centre’s careful balancing act

The burning question is how to think about the degree of MSP increase, and where it stands vis-à-vis meeting the twin objectives of boosting rural incomes but not being inflationary. (SANJEEV KUMAR/HT PHOTO)
Published on Jun 13, 2023 09:36 PM IST

2,000 note move may have marginal impact

The decision to withdraw the banknotes will impact liquidity, bank deposits and policy rates. All eyes will be on the share of notes exchanged versus deposited

Even if 10-20% of the <span class='webrupee'>₹</span>2,000 notes are deposited, the banking system liquid-ity will improve by <span class='webrupee'>₹</span>35,000-70,000 crore. This would imply that the RBI is less likely to change its monetary policy stance in June (SANTOSH KUMAR/HT PHOTO)
Updated on May 24, 2023 07:12 PM IST

Budget: Focus on the quality of expenditure

India judiciously refrained from a large demand-side fiscal stimulus even during the pandemic by focusing on more public capex to build the supply side. It is important to continue with that theme in the FY24 budget

To start with, high-frequency growth indicators are doing reasonably well. Our combined index from these indicators, called Growth Activity Tracker for India (GATI), shows that even after a slight moderation in the last couple of months, the growth momentum is now close to the pre-pandemic average. (Sonu Mehta/HT PHOTO)
Updated on Jan 30, 2023 08:04 PM IST

In the inflation fight, a liquidity conundrum

Without any liquidity provision by RBI, bank deposit rates could go up; funding the State’s fiscal deficit could be more challenging, and credit growth may falter

The Reserve Bank of India should be conscious of creating enough liquidity to ensure money supply growth broadly tracks nominal GDP growth (HT)
Updated on Oct 19, 2022 08:03 PM IST

Farmer terms of trade: A nimble balancing act

The Centre will have to balance between curbing inflation and food prices, and ensuring cultivators’ welfare and backing rural demand growth

Farmers also face another kind of ‘terms of trade’ challenge: Between food prices and non-food prices. This indicator has been worsening for farmers, but over the last six months, the trend has been somewhat arrested. (PTI)
Published on Jun 01, 2022 06:49 PM IST

What to expect from this year’s Union Budget

The finance minister is likely to focus on the economy beyond the pandemic. Energising medium-term growth drivers will be key and the government should target high capex growth to sustain the infrastructure development momentum

The perennial dilemma of the budget — between spending to stimulate growth and maintaining fiscal discipline — is more accentuated in a year such as this when economic recovery has been uneven and the fiscal situation, precarious. (MINT)
Updated on Jan 28, 2022 08:53 PM IST
BySamiran Chakraborty
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