On the back of lower interest rates, advanced economies are adopting a more liberal fiscal approach. India is not in a position to embrace the same path. Inflation, for instance, is still a worry and higher debt can create instability in a developing country fairly quickly.
In the context of fiscal management, our lead editorial notes that instead of making higher public debt a permanent constraint for the Indian economy, the government should address its inability to mobilise revenues. India’s tax-GDP ratio has remained largely static for decades.
This Budget does little to assure strong growth beyond FY22. As I have written before, we will find it difficult to exceed an average of 5 per cent growth in the medium-term, writes Shankar Acharya
Although the private sector has overtaken the public sector in terms of job creation, the scale of operations of even the giants in Indian business has not been large enough to alter employment dynamics the way China has managed, writes Kanika Datta
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