FM told to balance fiscal discipline

Finance Minister Arun Jaitley on Wednesday met leading economists to seek ideas for the upcoming Budget, where the focus remained on maintaining fiscal discipline and adhering to a target, especially in the wake of the 7th Pay Commission and One Rank One Pension (OROP) giveaways putting pressure on government finances in the 2016-17 fiscal.

Bringing changes in the small savings rate, which will in turn push the economy, were discussed threadbare, along with ways to increasing private and public investment.
Other suggestions included focusing on measures on poverty reduction, increasing female labour participation in the growing economy and development measures for the tribal community.

It was suggested that the socio-economic caste census needed to be used for identifying the right beneficiaries, and thus bringing them to the forefront.
The Finance Minister’s attention was drawn towards the fertiliser subsidy not benefitting the farmers and suggestions were made to give it a relook.

There was mixed opinion in terms of reduction of the corporate tax, as some found it to be favouring the rich and others found it to be a great step towards increasing investment, and thus, boosting the economy.

There were suggestions to have a relook into the Income Tax slabs to bring about parity within the different sections of population.

The economists present during the meeting included Ajit Ranade of Aditya Birla Group, Sajjid Chinoy of JPMorgan, Sonal Varma of Nomura, Abhijit Banerjee of  Massachusetts Institute of Technology, Partha Mukhopadhyay of the Centre for Policy Research, Rinku Murgai from the World Bank, and Soumya Kanti Ghosh from the State Bank of India, among others.