Monday, December 19, 2011

Future need not be rosy but not reddish either

Markets are tizzy at the moment. The economy looks down the drain in the backdrop of global debt crisis; falling rupee; rising inflation; political paralysis and less than estimated GDP growth. But what holds promise is the concern of all and the anxiety to resurrect the sagging economy. Finance Minister has a tough task ahead in the Budget 2012-13, with just an year to go for the General Elections. The fiscal deficit would hardly find space for further doll-outs. The ray of hope is that the US economy promises a revival. The bail-out package to Europe also lends some credence to keep the balance swinging in favour of arresting unrest in the economy. However, the domestic undoing in the last two years unfolding scams after scams needs tackling firmly and this is where the infirmity lies. Markets are not going to behave worse if the FM makes bold to increase the Share transaction tax to at least one percent. Second, the farmers must be provided input subsidies of a larger scale than now but with laid out crop planning regionally acceptable; investmetns in drought proofing the economy; and finding resources for merti goods like education and health at double the rates prevailing now. The year ahead may not be rosy but need not be reddish either.

1 comment:

  1. Good piece of suggestion.Govt has to initiate some very bold steps ignoring the market sentiments and popularity. Stringent measures are the need of the hour to infuse capital in infrastructure development, agricultural production,storage,transportation and marketing. SME sector needs a boostand that is possible if a separate exchange is set up involving banks and SIDBI. Transaction tax for all high priced commodities like Diamond,Gold, silver and others needs to be introduced to augment the revenues of the Govt. Leakage of income by keeping a strict vigilance over Corporates and Govt institutions itself would give a boost to income of the Govt. Many economic activities and income generated do not seem to be reflecting in GDP growth and it is high time Govt tracks these activities and get them identified and recognised for deciding subsidies, employment, BPL income tax and other levies.Time to revamp the whole system of data collection in the economy.

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