Not focused on economy

Since we are badnaam as "Bhakts", no harm in writing such posts.

Now through the last few months and especially since the GDP suddenly began to get noticed and more so after CAA fasad, the common thing we hear is "This govt is focusing only on divisive issues, not focusing on economy...chee chee". On the other hand, one was reading on twitter and in news of the FM i.e. Nirmala Sitharaman (NS) doing press conferences galore to announce something or other. Being the nosy self that one is, I decided to dig further and see what was happening. I did a google search "Nirmala Sitharaman press conference" and found the following. You decide by yourself whether this looks like lack of focus or interest. This is only about focus and effort, results or whether they are enough is another matter. I am writing a blog on what happened to the economy tomorrow where we can judge whether what has been done is enough.

Broadly, it is agreed that the sectors in trouble were auto, real estate, banks, NBFCs and dampened demand in market amongst people due to “sentiment”. So go through the chronology of the PCs of NS and judge.

23rd August: 

- 70k crore into public sector banks. move is expected to generate an additional lending and liquidity in the financial system to the tune of Rs 5 lakh crore

- Rollback of enhanced surcharge on foreign portfolio investors

- Surcharge on long term and short term capital gains tax removed

- Data showed FPIs have pulled out Rs 23,000 crore from domestic equities in July and August, as the Budget proposal to levy a surcharge on higher tax-income groups affected 40 per cent of FPIs, operating as trusts or AoPs, and made investment in Indian equities unattractive. 

- RBI cuts to directly pass on to borrowers through MLCR reduction

- Angel tax removed

- Pending GST refunds to MSME within 30 days. Otherwise, MSME GST returns to be paid in 60 days

Auto – BS IV vehicles phase out delayed

2nd September:

- Merger of banks – 

o Oriental Bank plus united bank plus PNB to create second largest bank after SBI

o Canara bank and syndicate bank to merge

o Andhra and Corporate bank to merge with union bank

o Indian bank with Allahabad bank

- Cash infusion into banks of 70000 crore

7th September:

- Task force was set on 7th Sep to draw out a plan for a National Infrastructure Pipeline

16th September:

- The government to infuse INR 20,000 crore affordable housing package to benefit around 3.5 lakh home owners. The government  proposed a special financing window in a bid to restore stuck housing projects.

- Automated Electronic Refund System: The government to provide automated electronic refund system for paying GST credits to businesses; the move will be implemented by September.

- RoDTEP: The government announced the introduction of a new scheme for remission of duties or taxes on export product (RoDTEP) to replace the existing Merchandise Exports from India Scheme (MEIS) from January 1 next year and revised priority sector lending norms for export credit that will release an additional INR 36,000 crore to INR 68,000 crore as export credit under priority sector.

- INR 1,700 crore for Export Guarantee: Granting relief to MSMEs , government also made a statement regarding Export Credit Guarantee Corporation (ECGC) will increase the scope of Export Credit Insurance Service to offer higher insurance cover to banks lending working capital for exports. This is expected to reduce overall cost of export credit including interest rates, especially to MSMEs.

- Annual Mega Shopping Festivals: Dubai-like annual mega shopping festivals are proposed to be organised in 4 places in India across March 2020 in 4 themes (gems & jewellery, handicrafts, yoga, tourism, textile and leather).

23rd September

- Big bang reform - Corporate tax rate cuts – 35% to 25% - at par with other Asian economies mostly

6th  November – 

- The government has approved setting up of a Rs25,000cr bailout fund to finance 1,600 stalled housing projects to kickstart incomplete real estate projects.

- The government will establish a "special window" to offer priority debt financing for completion of stalled housing projects in the affordable and middle-income housing sector.

- An alternative investment fund (AIF) will be created. The government will put in Rs10,000cr and others, such as SBI and LIC, will create funds of Rs25,000cr in total.

- This investment will be used to complete housing units worth less than Rs2cr in Mumbai, Rs1.5cr in Delhi-NCR, Chennai, other metros, and Rs1cr in other cities.

21-November – 

- Disinvestment of 5 major PSUs announced – BPCL, Shipping Corporation of India (SCI), Container Corporation of India (CCI), THDC India Ltd, North Eastern Electric Power Corp (NEECP)

- Story of BPCL will follow later – which is a brilliant move by this govt

31-Dec – 

- National Infrastructure pipeline declared. Task force was set on 7th Sep to draw out a plan

- 102 lakh crore investment across country – roads (19.64), urban and housing (16.29), Railways (13.69), Conventional power (11.76), Renewable energy (9.3), irrigation (7.73), Rural infra (4.11), drinking water (3.62), Digital infra (3.2), Industrial corridors (2.99), Petroleum natural gas (1.95), Health (1.69), atomic energy (1.54), airports and ports (2.44) and so on 

- 42% are in implementation stage while 31% are in conceptualisation stage

- Centre and states will pitch in 39% each and private sector 22% which will increase to 30% by 2025

- 18 states have come on board so far

- 51 lakh crores spent so far in 6 years so this is a big jump

And now, we see reports of PM himself driving conversations with industry leaders, economists and others for the budget and revival of economy.

Considering above, does this look like a government not focused or caring about setting the economy right?