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Budget 2021 Expectations: Taxpayer grievance redressal system needs more teeth, independence

Budget 2021 Expectations: Taxpayer grievance redressal system needs more teeth, independence

Budget 2021 Expectations: Taxpayer grievance redressal system needs more teeth, independence
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Summary

Economic Survey 2021: Finance Minister Nirmala Sitharaman on Friday tabled the Economic Survey after President Ram Nath Kovind's customary address at the start of the Budget Session 2021. After an estimated 7.7 percent pandemic-driven contraction in 2020-21, India’s real GDP is projected to record a growth of 11 percent in 2021-22 and the nominal GDP by 15.4 percent, the Survey reads.

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Jan 29, 2021 10:15 PM

Economic Survey 2021 LIVE Updates: India likely to post current account surplus after 17 years

India is likely to post a current account surplus after a gap of 17 years, at 2 per cent of GDP during 2020-21, on back of resilient software services export, said the Economic Survey tabled in Parliament on Friday. India's current account deficit averaged 2.2 per cent of gross domestic product (GDP) in the last 10 years. However, reversing this trend, current account balance turned into surplus (0.1 per cent of GDP) in fourth quarter 2019-20 on the back of, among others, a lower trade deficit and a sharp rise in net invisible receipts. This quarterly surplus was registered after a gap of 13 years after fourth quarter of fiscal 2006-07. This has been followed by successive current account surpluses in first and second quarters of the current fiscal. In the first half of 2020-21, steep contraction in merchandise imports and lower outgo for travel services led to a sharper fall in current payments (by 30.8 per cent) than current receipts (15.1 per cent) leading to a current account surplus of USD 34.7 billion (3.1 per cent of GDP) "Given the trend in imports of both goods and services, it is expected that India will end with an annual current account surplus of at least 2 per cent of GDP after a period of 17 years," said the survey for 2020-21.

Jan 29, 2021 9:33 PM

Economic Survey 2021 LIVE Updates: Worst behind us but continuous govt support needed, says India Inc

The Economic Survey reaffirms that the worst is behind us and the economy would bounce back with a V-shaped recovery after being hit hard by the COVID-19 pandemic, India Inc said on Friday. Sharing their views on the Survey 2020-21 tabled in Parliament, the industry also made a case for continuation of support from the government this year for a broad base recovery and revitalise the ameliorating economic growth. CII Director General Chandrajit Banerjee said the survey makes a candid and convincing assessment of the Indian economy based on objective analysis, enriching content and credible policy direction to take the economy forward. "While striking an optimistic note, the Survey reaffirms that the worst is behind us and the economy would bounce back, to experience a resilient V shaped recovery after being hard hit by the COVID-19 pandemic. The availability of the vaccine and robust service sector recovery would further buttress the growth momentum," Banerjee said.

Jan 29, 2021 9:07 PM

Economic Survey 2021 LIVE Updates: Growth leads to debt sustainability

Making a case for an optimal fiscal stance, the Economic Survey on Friday said growth leads to debt sustainability and not necessarily vice-versa. "This is because debt sustainability depends on the 'Interest Rate Growth Rate Differential' (IRGD) i.e. the difference between the interest rate and the growth rate in an economy. "With the Indian context of potential high growth, the interest rate on debt paid by the Indian government has been less than India's growth rate by norm, not by exception," it said.

Jan 29, 2021 8:58 PM

Economic Survey 2021 LIVE Updates: Asset Quality Review to blame for banking sector woes

The Economic Survey has criticised the Asset Quality Review (AQR) undertaken by the Reserve Bank in 2015 under Governor Raghuram Rajan, saying it under-estimated the extend of bad loans, and exacerbated problems created by forbearance. "If the AQR had correctly identified all the hidden bad quality assets on banks’ books, all the increase in NPAs and the necessary provisioning would have concluded by the stated deadline of FY2017. However, the gross NPAs in the Indian banking sector only increased to 11.2% by FY2018. A massive surge in loan loss provisioning also occurred in FY2018 – a year after AQR was supposed to make bank balance sheets healthy."

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Jan 29, 2021 8:08 PM

Economic Survey 2021 LIVE Updates: Meet KV Subramanian, the Chief Economic Advisor behind the Survey

Krishnamurthy Venkata Subramanian, Chief Economic Advisor (CEA) of the government of India, is the architect of the Economic Survey 2021 which was tabled by union finance minister Nirmala Sitharaman on Friday. The survey which is tabled in both Lok Sabha and Rajya Rabha, lays the foundation of the union budget. It contains an assessment of the various economic parameters of the past financial year and guides the key policy decisions to be taken in the next and thus helps shape the budget. The CEA’s responsibilities include providing inputs on industrial development and foreign trade, analysing trends in industrial production and delivering statistical information on various economic indicators.

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Jan 29, 2021 7:35 PM

Economic Survey 2021 LIVE Updates: Indian IT-BPM sector saw recovery in revenue growth at 7.9% in FY20

The Indian IT-BPM sector witnessed a recovery in revenue growth at 7.9 per cent in FY2019-20, primarily driven by a significant boost in domestic revenue, as per the Economic Survey 2020-21. The Survey highlighted that the government undertook a number of structural reforms last year amid the pandemic to drive innovation, technology adoption and efficiency in the sector, including relaxation of OSP Terms and Conditions, and Consumer Protection (E-commerce) Rules, 2020. "This would significantly expand access to talent, increase job creation, make India a global hub for digital services and catapult the sector to the next level of growth and innovation," it said.

Jan 29, 2021 7:27 PM

Economic Survey 2021 LIVE Updates: Taxpayer grievance redressal system needs more teeth, independence

The government should reinvigorate the taxpayer grievance redressal system by giving it more teeth and making it independent of the tax department to help build trust in tax administration, the Economic Survey said on Friday. Globally countries -- like US, Canada, UK -- with an independent tax ombudsman have performed better on the tax administration front through better trust between the taxpayers and tax authorities, and have exhibited a higher average Tax to GDP ratio and lower time taken to file them. "International experience suggests an ombudsman system is necessary for ensuring protection of taxpayer's rights. However, the institution, in India's past experience, was not effective and was abolished. A possible reason may have been inadequate independence from the tax department. "Therefore, there is a need to reinvigorate the systems of grievance redressal in India, and incorporate a more holistic view of enhancing customer experience and protecting taxpayer rights," the Economic Survey 2020-21 said.

Jan 29, 2021 7:04 PM

Economic Survey 2021 LIVE Updates: 10 ideas towards achieving higher growth rate basing it on wealth creation, says PwC India

Ranen Banerjee, Leader - Economic Advisory Services, PwC India said, "The Economic Survey has projected a strong V shaped recovery with an 11% growth in FY22. It is an achievable target given the lower base owing to the consensus that 7% plus contraction will be experienced in FY21. The Economic Survey has laid out 10 ideas towards achieving and sustaining a higher growth rate basing it on the theme of wealth creation. Trust and market forces doing a handshake has been the basis of the 10  ideas. Jobs is what India needs to put us on the virtuous cycle of enhanced consumption, resource generation for the government to invest in infrastructure, and investments by the private sector and wealth creators should continue to sustain job creation."

Jan 29, 2021 7:02 PM

Economic Survey 2021 LIVE Updates: Economic Survey flags high T&D losses in power sector

India's transmission and distribution (T&D) losses in the power sector are "substantial" and are very high compared to peer nations, flagged the Economic Survey for 2020-21. The T&D losses represent electricity that is generated but does not reach intended customers. India's T&D losses have been over 20 per cent of generation, which is more than twice the world average. The ideal level of T&D losses ranges between six to eight per cent. According to the Central Electricity Authority's latest report of October, 2020 the T&D losses had declined to 20.66 per cent in 2018-19, from 21.04 per cent in 2017-18, and 21.42 per cent in 2016-17.

Jan 29, 2021 6:53 PM

Economic Survey 2021 LIVE Updates: Need to promote non-discriminatory practices at workplace for women

There is a need to promote non-discriminatory practices at the workplace like pay and career progression, improving work incentives and social security benefits for women to increase the level of female labour force participation rate in India, said the Economic Survey tabled in Parliament on Friday. As per the Economic Survey for 2020-21, the labour force participation rate of females in the productive age (15-59 years) was 26.5 per cent in 2018-19, as compared to 80.3 per cent for males (rural+urban). "In order to incentivise more women to join into the labour force, investment in institutional support to affordable and quality child care facilities, paid paternal leave, family-friendly work environment, and support for elderly care needs to be made," suggested the Economic Survey 2020-21, presented by Finance Minister Nirmala Sitharaman. The Economic Survey for 2020-21 also advocated for the "need to promote non-discriminatory practices at the workplace like pay and career progression, improve work incentives, including other medical and social security benefits for female workers".

Jan 29, 2021 6:46 PM

Economic Survey 2021 LIVE Updates: Eco Survey pitches for hike in PDS rates to trim food subsidy bill

Stating that the food subsidy bill is becoming "unmanageably large", the Economic Survey 2021 on Friday suggested the government to increase the selling price of foodgrains provided through ration shops to over 80 crore beneficiaries. Foodgrains via ration shops are supplied at highly subsidised rates of Rs 3 per kg for rice, Rs 2 per kg for wheat and Rs 1 per kg for coarse grains through Public Distribution System (PDS) as per the National Food Security Act (NFSA). "While it is difficult to reduce the economic cost of food management in view of rising commitment towards food security, there is a need to consider the revision of central issue price (CIP) to reduce the bulging food subsidy bill," the survey said. CIP is the subsidised rate at which foodgrains are distributed through ration shops. In order to ensure food security to the vulnerable sections, the government has continued with the subsidised pricing under the NFSA.

Jan 29, 2021 6:33 PM

Economic Survey 2021 LIVE Updates: Exports may dip 5.8%, imports by 11.3% in second half of 2020-21

The country's exports are expected to contract by 5.8 per cent and imports by 11.3 per cent during the second half of the current financial year, though implementationof several measures by the government would help support exports going forward,according to the Economic Survey 2021. With gradual recovery of economic activities, the survey said that imports and exports have picked up. During the first half of 2020-21 (April-September), exports dipped by 21.31 per cent to USD 125.25 billion while imports declined by 40 per cent to USD 148.69 billion. "Net exports (difference between exports and imports) is expected to re-enter the negative territory in the second half. Exports are expected to decline by 5.8 per cent and imports by 11.3 per cent in the second half of the year," the survey said.

Jan 29, 2021 6:02 PM

Govt revises last FY19-20 growth to 4% from 4.2%; FY18-18 growth too revised to 6.5% from 6.1%

Govt revises last FY economic growth to 4 percent from 4.2 percent expansion earlier; revises FY19 economic growth to 6.5 percent from 6.1 percent earlier. Real GDP or GDP at constant (2011-12) prices for the years 2019-20 and 2018-19 stand at Rs 145.69 lakh crore and Rs 140.03 lakh crore, respectively, showing growth of 4 percent during 2019-20 and 6.5 percent during 2018-19

Jan 29, 2021 5:59 PM

Economic Survey 2021 LIVE Updates: Improvement in access to bare necessities but disparities continue

Disparities continue to exist despite improvements in people's access to 'the bare necessities' across India in 2018 from 2012, and appropriate strategy needs to be designed for the country to achieve SDG goals by 2030, according to the Economic Survey 2020-21. Building on previous year's survey that examined access to food through the idea of "Thalinomics: The Economics of a Plate of Food in India", this year it took a step further to study access to 'the bare necessities' -- housing, water, sanitation, electricity and clean cooking fuel. It constructed a Bare Necessities Index (BNI) at rural, urban and all India level by summarising 26 indicators on five dimensions of access to water, sanitation, housing, micro-environment, and other facilities.

Jan 29, 2021 5:51 PM