Modi inaugurates world's second-biggest dam 'Sardar Sarovar', dedicates it to nation

Feb 2: Prime Minister Narendra Modi’s second budget in seven months disappointed investors who were hoping for big-bang stimulus to revive growth in Asia’s third-largest economy.

The fiscal plan -- delivered by Finance Minister Nirmala Sitharaman on Saturday -- proposed tax cuts for individuals and wider deficit targets but failed to provide specific steps to fix a struggling financial sector, improve infrastructure and create jobs. Stocks slumped as a proposal to scrap the dividend distribution tax for companies failed to impress investors.

"Far from being a game changer, the budget provides little in terms of short-term growth stimulus,” said Priyanka Kishore, head of India and South East Asia economics at Oxford Economics Ltd. in Singapore. “While income tax cuts will provide some relief on the consumption front, the multiplier effect is low and the overall stance of the budget is not expansionary."

India has gone from being the world’s fastest-growing major economy three years ago, expanding at 8%, to posting its weakest performance in more than a decade this fiscal year, estimated at 5%.

While the government has taken a number of steps in recent months to spur growth, they’ve fallen short of spurring demand in the consumption-driven economy. Saturday’s budget just added to the glum sentiment.

Okay Budget

“It’s an okay budget but not firing on all cylinders that the market was hoping for,” said Andrew Holland, chief executive officer at Avendus Capital Alternate Strategies in Mumbai.

The government had limited scope for a large stimulus given a huge shortfall in revenues in the current year. The slippage induced Sitharaman to invoke a never-used provision in fiscal laws, allowing the government to exceed the budget gap by 0.5 percentage points. The result: the deficit for the year ending March was widened to 3.8% of gross domestic product from a planned 3.3%.

On Friday, India’s chief economic adviser Krishnamurthy Subramanian said reviving economic growth was an “urgent priority” and deficit goals could be relaxed to achieve that. The adviser’s Economic Survey estimated growth will rebound to 6%-6.5% in the year starting April.

The fiscal gap will narrow to 3.5% next year, as the government budgeted for gross market borrowing to rise marginally to 7.8 trillion rupees from 7.1 trillion rupees in the current year. A plan to earn 2.1 trillion rupees by selling state-owned assets in the year starting April will also help plug the deficit.

Total spending in the coming fiscal year will increase to 30.4 trillion rupees, representing a 13% increase from the current year’s budget, according to latest data.

Key highlights from the budget:

* Tax on annual income up to 1.25 million rupees pared, with riders

* Dividend distribution tax to be levied on investors, instead of companies

* Farm sector budget raised 28%, transport infrastructure gets 7% more

* Spending on education raised 5%

* Fertilizer subsidy cut 10%

Analysts said the muted spending plan to keep the deficit in check will lead to more downside risks to growth in the coming months.

“It is very doubtful that the increase in expenditure will push demand much,” Chakravarthy Rangarajan, former governor at the Reserve Bank of India told BloombergQuint, adding that achieving next year’s budget deficit goal of 3.5% of GDP was doubtful.

With the government sticking to a conservative fiscal path, the focus will now turn to central bank, which is set to review monetary policy on Feb. 6. Given inflation has surged to a five-year high of 7.35%, the RBI is unlikely to lower interest rates.

What Bloomberg’s Economists Say:

The burden of recovery now falls solely on the Reserve Bank of India. With inflation breaching RBI’s target at present, any rate cuts by the central bank are likely to be delayed and contingent upon inflation falling below the upper end of its 2%-6% target range.

-- Abhishek Gupta, India economist

Governor Shaktikanta Das may instead focus on unconventional policy tools such as the Federal Reserve-style Operation Twist -- buying long-end debt while selling short-tenor bonds -- to keep borrowing costs down.

New Delhi, Jun 4: India on Thursday witnessed a record single-day spike of 9,304 coronavirus cases taking the country's tally to 2,16,919, according to the Union Ministry of Health and Family Welfare.

The ministry informed that 260 more deaths due to coronavirus were reported in the last 24 hours.

The total number of cases in the country now stands at 2,16,919 including 1,06,737 active cases, 1,04,107 cured/discharged/migrated and 6,075 deaths.

Maharashtra has so far reported 74,860 cases, more than any other state in the country.

In Tamil Nadu, 25,872 cases have been detected so far while Delhi has reported 23,645 coronavirus cases.

According to the Indian Council of Medical Research (ICMR), 1,39,485 samples were tested in the last 24 hours whereas 42,42,718 samples have been tested till date.

New Delhi, Jul 23: A Delhi court Thursday allowed 198 Indonesians to walk free on payment of varying fines, after they accepted mild charges under the plea bargain process, related to various violations including visa norms while attending the Tablighi Jamaat event here during the COVID-19 lockdown.

Metropolitan Magistrate Vasundhara Azad allowed 100 Indonesians to walk free on payment of a fine of Rs 7,000 each, said advocates Ashima Mandla, Fahim Khan and Ahmed Khan, appearing for them.

Metropolitan Magistrate Swati Sharma allowed 98 Indonesians to walk free on payment of a fine of Rs 5,000 each.

The court directed the 98 Indonesians to deposit their fines to PM CARES Fund.

The Sub-divisional magistrate of Defence Colony, who was the complainant in the case, Assistant Commissioner of Police of Lajpat Nagar and Inspector of Nizamuddin said they have no objection to it.

However, one Indonesian did not plead guilty to the charges against them and claimed trial before the court.

Under plea bargaining, the accused plead guilty to the offence praying for a lesser punishment. The Criminal Procedure of Code allows for plea bargaining in cases where the maximum punishment is 7-year imprisonment; offences don''t affect the socio-economic conditions of the society and the offence is not committed against a woman or a child below 14 years.

The foreigners were chargesheeted for attending the religious congregation at Nizamuddin Markaz event in the national capital by allegedly violating visa conditions, indulging in missionary activities illegally and violating government guidelines, issued in the wake of Covid-19 outbreak in the country.

They were granted bail earlier by the court on a personal bond of Rs 10,000 each.