7,00,000 crore stimulus to the economy

With the first quarterly results of GST indication weak economic conditions, Arun Jaitley, finance minister of India had said, “We will appropriately respond to the situations as they develop.” As the finance minister had said, when a country undergoes reforms on a scale as large as GST, short-term minor hiccups are expected. And it is the duty of the central government, to help the nation recover from such difficult times. October 24 during the press conference, Finance minister spoke at length, “There has been a lot of discussion within the government and with the Prime Minister. India has been the fastest-growing major economy for the last three years and the attempt is to maintain a high growth rate in the coming years”. And in one such attempt, the Indian government has provided a huge stimulus to the economy. Highlights of the presentation: India continues to be an economy with strong macro fundamentals. Consistent inflation control. Current account deficit is 0.7% which is under the safe limit of 2% Forex reserves amount up to an all-time high of $400 billion. Fiscal deficit currently stands at 3.5%. GDP of the country has lost some strength and has come down to 5.7% over the last quarter. However, as IMF has predicted, Indian economy will soon catch up. Transformative steps were taken by the government GST, goods and services tax Disinvestment targets Increased public infrastructure spending with targets exceeding by almost 30% over the last year. Bankruptcy law With the economy in the strong state and the steps taken by the government in the right direction, the government decided to give it a fillip. Providing infrastructure boost involving capital expenditure. Roads The government plans to build 83,667 km of roads at an investment of ₹6.92 lakh over a period of 5 years generating 14.2 cr jobs. Funding from different sectors is planned. 2.09 lakh crore comes from market 1.06 lakh crore comes from private Investments 2.19 lakh crore comes from tolls Remaining 1.57 lakh crore comes from Central road budget. Different organizations have been invited on board to carry out the task they specialize in. NHAI, NHIDCL, MoRTH and State PWD’s. The biggest part of the project is the Bharat Mala project. The project more than 34800 km road is to be constructed including economic corridors, feeder corridors, and national corridors. This is expected to increase the connectivity across the country and facilitate cross-border trade. The project works with extra consideration over the North Eastern area. Further monetization of 82 identified roads is a part of the project. For the Pradhan Mantri Gram, Sadak Yojana gets an 88000 crore boost which special coverage for left-wing extremist areas. Housing (Awas Yojana) 2.2 crore families to get their own houses with over 3 lakh crore investment over the next 3 years. The government plans to implement universal affordable housing to give a big boost to the construction industry. Power (Saubhagya Yojana) All the remaining villages to get electricity connexions over the next 2 years. Individual households to get electricity connections. Expected investment of over 16,320 crores. Railways (bringing railways back on track) Railways will witness investments more than 1.3 lakh crore over the next year. Improving passenger facilities, laying of new tracks and incubation of new technologies are the key parts of the project. The government plans to lay more than 913 km of railway track annually. Strengthening banks full more jobs and more investment Identifying NPA’s Mass transparent recognition of NPA’s Checking the quality of collaterals Cross verifying loans taken with other banks NPA’s increased by an amount of 455000 over 3 years. Increase provisioning to cover expected loss Banks have increased provisioning to cover the expected losses. The government has provided provisioning of over 374000 crores for the past 3 years This ensures that banks maintain health. Capital infusion into banks Project Indra Dhanush launched in 2015 insured that banks comply with the Basel III norms. The government has fused over 58000 crores in 3 years. Enacting IBC and making SARFAESI Act more effective. PSB capitalization for more jobs. The government has announced a 211000 crore rupees investment for the PSB’s over the next 2 years. While 1.3 lakh crore comes from recap bonds, the remaining amount comes from budgetary support. As a result, the government expects bigger and stronger PSB’s. Therefore we are looking at employment generation with faster MSME growth. Therefore with these investments in the right blocks coupled with the right policies, we Indian economy must soon be picking up the pace. Probably this will help in checking regional imbalances, keeping track of downstream activities and improving interstate connectivity. Most importantly we will witness relaxed trade barriers and a connected India.

7,00,000 crore stimulus to the economy

North India Statesman

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