Given the continued higher growth trajectory, the risks remain that interest rates need to be adjusted further up. |
Inflationary pressures are not relenting. The economy is doing really well. Salary hikes have been phenomenal. |
Inflationary trends have been curbed to some extent. |
It's a very important step India has to take to move to full convertibility of the rupee. It's better for India as it opens up its market. |
The cash shortage in the economy is temporary because it is a consequence of government not spending enough and repayment of debt by the State Bank of India in December. Capital inflows are still strong. |
The finance minister is assuming an optimistic outlook for tax revenues, especially corporate taxes. He expects corporate tax collection to increase a hefty 28.4 percent, despite indications that industrial activity is rolling over. Perhaps he is betting on improving compliance. |
The finance minister may announce a deficit target of about 4 per cent of GDP, but spending pressures will mean that achieving such a target will be quite a challenge in fiscal 06/07. |
The finance minister may announce a deficit target of about 4 percent of GDP, but spending pressures will mean that achieving such a target will be quite a challenge in fiscal 06/07. |