Positive budget, but thinly spread: CRISIL Research
CRISIL Research has come out with a report on Union Budget 2011-12.
March 03, 2011 / 18:43 IST
CRISIL Research has come out with a report on Union Budget 2011-12.
Union Budget 2011-12- Positive, but thinly spread:The three key macroeconomic concerns before Union Budget 2011-12 were high inflation, high current account deficit (CAD), and fiscal consolidation. Additionally, there was an expectation that the government would restart the reform process. The Budget has made an attempt to address all these issues, albeit through small steps. Despite the strong performance of the economy in 2010-11, the outlook for 2011-12 is clouded by stubborn and persistently high inflation, and rising external risks. The Budget factors in a GDP growth target of 9 per cent, which is on the optimistic side. CRISIL expects GDP growth to moderate to 8.3 per cent in 2011-12.By lowering the fiscal deficit target to 4.6 per cent in 2011-12 from 5.1 per cent achieved in 2010-11, the Budget reiterates its commitment towards medium-term fiscal consolidation. As it sets a lower deficit, the Budget is not
expansionary, and does not conflict with the Reserve Bank of India
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