Union Finance Minister Nirmala Sitharaman said on Wednesday that she is betting big on India’s growth projections and expects the economy to grow by more than 7% from the next year.
When it comes to India’s growth, we’re looking at near double-digit growth this year and it would be the highest in the world. And for next year, based on this year, growth would definitely be in the order of eight percent, Sitharaman said.
She noted that although the Ministry of Finance has yet to assess the growth figure, the World Bank, IMF and rating agencies have all come close to this type of growth figure for India.
So the following year would also be somewhere in the eight to nine (percent) range, 7.5 to 8.5 (percent) would be the growth. And I expect this to hold over the next decade or so because of the speed at which the expansion of basic industries is happening, the speed at which services are expanding, I don’t see a reason why. that India is anyway lower than that of the next decades to come, she said.
The minister also dwelled at length on the deaths of Lakhimpur Khetri. When asked if the government was “pretending to sleep” on the same subject, she replied, “No, absolutely not. The incident is absolutely reprehensible, each of us says so.
She said: “It’s not on the defensive about my party or the prime minister, it’s on the defensive about India. I won’t be mocked, if it’s mocking, I will be. on the defensive to get up and say, sorry, let’s talk the facts. “
Union Finance Secretary TV Somanathan said there would likely be a huge increase in spending in the coming months due to additional spending on fertilizer subsidies and payment arrears to exporters, among some of the main expenditure items.
The secretary said these are factors analysts fail to consider in their reports that seem to indicate that sustained tax revenues will help the government settle for a lower-than-budget budget deficit.
“Analysts underestimate our spending side”
Somanathan said, “Even after deducting the contribution to states, we expect revenues to be higher than budgeted. However, there is also a considerable increase in several expense items, such as the food subsidy.
But there are also others like increased fertilizer subsidy and arrears payments from export incentive programs like MEIS and SEIS which have also been announced. As a result, some analysts may be underestimating our spending. So there is an increase in expenses and revenues. “
“PSB next fiscal privatization”
He said the privatization of public sector banks (PSBs) could spill over in the next fiscal year. When asked about this, Somanathan said, “I think it’s likely, yes.”
The secretary said that even though tax revenue will exceed this year’s budget estimates, there will be no inflow of non-tax revenue from spectrum and AGR payments for the next four years due to the announced moratorium for the industry. telecommunications. Likewise, uncertainty as to what proportion of the divestment revenue target will be met cannot be ruled out.
“Non-tax revenue gap on telecommunications moratoria”
“There is also a risk on the side of non-tax revenues such as the moratoriums that have been proposed on the telecom package. We will therefore see a certain drop in non-tax revenues. Again, you know the progress made on privatizations like Air India but it’s too early to estimate the total non-revenue revenue because of all the reasons I mentioned, ”Somanathan said.
The secretary said the government will spend more on the vaccine budget for this fiscal year, and although orders worth over Rs 36,000 crore for vaccines have been placed, the government is not sure of the actual amount of additional costs.
“Vaccine orders worth Rs 36,000 crore placed”
He said the government had already made commitments in excess of around Rs 36,000 crore for the purchase of vaccines: “I am not saying payments, I am saying orders placed, which will have to be paid. can see the numbers are pretty good, and i think the government will probably meet its goal of vaccinating the adult population very soon and yes it will be over budget. The budget was Rs 35,000 crore, I think it will definitely be above that, I am not yet able to speculate on the exact figure as there is a mix of vaccines at different prices, cheaper vaccines are likely to happen. “
“We will not be too far from our budget deficit projections”
However, the secretary is confident to be close to the deficit target of 6.8% set for this fiscal year.
First publication: STI