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Union Budget has at least twenty big ticket reform measures: MoS Finance

India Blooms News Service | | 25 Apr 2015, 05:09 pm
Kolkata, Apr 25 (IBNS) Union Minister of State for Finance Jayant Sinha said that Macro Economic stability has been restored and inflation has been under control and the confidence of investors in Indian economy has been restored in the last one year by the NDA government.

He was addressing the delegates at the Special session on the theme ’Fiscal Reforms and Fiscal Governance: Some New Paradigm’, organized by Bharat Chamber of Commerce, here on Saturday.

He said that on 26th May, 2014 when the new government was formed, the macro-economic situation in the country was not good with GDP below 5 per cent for two consecutive year, inflation rate aboue 10 per cent, fiscal deficit at 4.6 per cent, current account deficit above 4 per cent, with World losing its confidence on India and people not interested in putting their money in stock markets and banks.

He said that India has the highest debt to GDP ratio in any growing economy in the world and the borrowing is to the extent of 5.3 lakh crores which is 40 per cent of the actual tax collection in the country.

He said tax to GDPratio is 10 per cent and Fiscal deficit is 3.9 per cent which are not ideal.

He said that Budget 2015 has laid the roadmap for the country in the coming five years and has tried to meet the expectation of people as envisaged in the government policy of ‘Sab Ka Sath Sab Ka Vikas’.

The Minister said the Union Budget 2015 has identified six stake holders whose interests are to be addressed, of which three relates to the poor people, youth and farmers as underlined by the Prime Minister, with middle class tax-payers, industrialists and investors being the others.

He also said that 20 big ticket reforms have been announced in General Budget 2015 compared to 8-10 in the best of earlier budgets since 1991.

He identified 42 per cent devolution of revenue collected to states, GST which will change the taxing powers of states, corporate tax assessment measures as the three important initiatives which will revamp the fiscal architecture of India and also increase tax to GDP ratio from the existing 10 per cent in India which is the lowest among BRICS countries. It is more than three times (30 per cent) in OECD countries.

Jayant Sinha said that the mission is to achieve the growth rate of 8-10 per cent in the next decade without inflationary pressure.

The Minister also said that there were three major challenges to increase productivity, namely re-starting 1400 stalled projects, bring down interest rate and strengthen our institutions to create a non-discretionary policy environment.

Giving an analogy of cricket during this IPL season Shri Sinha said that the government can be the grounds-person preparing, rolling the ground and act as umpire while the industrialists are the players and captains who have to play well.

Responding to a query during the interactive session he allayed the concern expressed by the representative of jewelry industry regarding the need to use PAN card for purchases aboue one lakh rupees and said that this is meant for surveillance on those who are making gold purchases using cash.

He advised the industry to advice people to get PAN cards which is very easy these days. Regarding continued harassment by   some tax officials , Sinha advised the concerned to complain to Ombuds-person or to his office in New Delhi so that action can be taken against such people.

However, he said that while the government is trying its best to have a hassle free transparent system in place but any systemic change do not take place overnight and one must cooperate with the government in its effort.

Replying to another question on the future of banking sector, Sinha said that profound changes have been introduced to reform the public sector banks, like separating the role of Chairman and MD; fixed tenure of minimum three years for Chairman and MD; opening up of Chairman and MD posts to private sector; Market linked compensation and establishing banking bureau which will select independent directors, minimizing the role of department of financial services with no interference in public sector banks and insurance companies as ordered by the  Prime Minister.

He said that the mission is to take India from the position of 142 to within top 50 position in the world as far as ease of doing business in the country is concerned with minimum government and maximum governance. 

He said that the government is trying to create level playing field for all, domestic and global players and indicated that as part reforming RBI, Public Debt Management Agency is in the pipeline.
 

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