FDI in first half up 13% at $35 bn, says CEA in update on progress made after recent reform measures
The Finance Ministry has not yet discussed proposing, to the Goods and Services Tax (GST) Council, an increase in tax rates, Finance Minister Nirmala Sitharaman said on Friday.
Last month, the Ministry had written to all States seeking suggestions on increasing GST revenues, including looking at the rates of tax and compensation cess on various items.
Since then, several officials had unofficially confirmed to the media that a proposal to increase GST rates was on the cards.
“The buzz is everywhere else other than in my office,” she informed the media.
“I don’t know where this is coming from. I have not been to the GST Council, so if it is to request them for a hike in rates or ask them to review, nothing has been spoken among ourselves [the Minister and the Secretaries in the Finance Ministry]. We have not had any conversation on it yet on what we want to go to the GST Council with.”
The Minister, however, refused to say if such a proposal was off the table. GST revenues had crossed the ₹1 lakh-crore mark in only four out the eight months during the current financial year for which data was available.
In a presentation on recent progress made following reform measures by the government, Chief Economic Adviser Krishnamurthy Subramanian said more than 60% of the dues of 32 central public sector enterprises had been cleared in the last two months.
Repo-rate linked loans
He further said following the Reserve Bank of India’s guidelines mandating banks to link their lending rates to external benchmarks, all public sector banks had introduced repo rate-linked loan products. As of November 27, 8.18 lakh repo-linked loans, amounting to ₹72,201 crore, had been sanctioned, he said.
On steps to boost investment, Mr. Subramanian said the government’s continuous liberalisation reforms had resulted in record foreign direct investments of $35 billion in the first half of 2019-20, up from $31 billion in the first half of the previous year.
Further, the government had already undertaken 66% of the budgeted capital expenditure of ₹3.38 lakh crore for the year.
He said the composition of employment in the country was gradually changing. While casual workers made up 30% of the workforce in 2011-12, they made up 25% in 2017-18.
This shift has been towards salaried employment, which rose to 23% in 2017-18 from 17% in 2011-12.
In the same period, the proportion of workers in agriculture had decreased to 44% from 49%.
The proportion in services had increased to 31% from 27%, and in manufacturing to 25% from 24%.
Source- The Hindu.