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The financial market expected to increase transparency in the budget: Report.


Finance Minister Nirmala Sitharaman will present the country's general budget on 1 February. The financial market hopes that more transparency will be seen in the announcement in the budget. These things have been said in the report of Singapore's banking group DBS. DBS report came on Thursday. The report, titled 'India Budget Preview: Losing the Purse', says, "Reduction in fiscal deficit will create negative perception about debt in the near future. In such a situation, a balanced plan will be needed."

According to this report, in the first eight months of the financial year 2019-20, the fiscal deficit remained 15 percent above the target due to weak revenue. Broadly speaking, the spending has been close to the projected level. However, the increase in fiscal deficit is no different from the earlier trends.

Radhika Rao, economist at DBS, said, "This often happens because fiscal pressure increases in the first three-quarters of the year and spending decreases in the last quarter."

However, Rao said that the pace of fiscal deficit in FY 2019-20 shows that the fourth quarter figures may be insufficient to ease the pressure. Till November, the gross tax revenue has increased only 0.8 percent year-on-year compared to 1.2 to 1.5 percent earlier.

However, Rao said that the pace of fiscal deficit in FY 2019-20 shows that the fourth quarter figures may be insufficient to ease the pressure. Till November, the gross tax revenue has increased only 0.8 percent year-on-year compared to 1.2 to 1.5 percent earlier.




Income from non-tax revenue is expected to improve. This includes additional dividend (0.25 per cent of GDP) from the Reserve Bank, partial payment from telecom companies and income from dividend after the Supreme Court order. The plan to sell strategic stakes in five government companies in November was quite significant. But due to remaining only three months in the current financial year, it seems that its income will be achieved only in the financial year 2020-21. Rao said, "We think expenditure will be curbed in the fourth quarter."

In the fiscal year 2019-20 till November, the total earning was 180 billion, while the estimate was 1.05 lakh crore rupees (0.5 per cent of GDP). Even if the stake sale and ETF collections are included, it will be up to 600 billion, which is much less than the target.

The Department of Economic Affairs has constantly asked other departments to reduce expenses. This means that for ministries that have spent less, the cuts in the second half may be higher. Apart from this, the government can also try to increase savings by delaying distribution. The government has to distribute subsidy under PM Kisan Yojana. It can be delayed. Apart from this, delay in announcing reforms for the sector is also possible. Despite all the equations, Rao believes that the fiscal deficit may exceed 0.3 per cent of the target.


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