BUSINESS
Unified Pension Scheme: Old, bad ideas in a new package
If actual market performance is short of the government’s assumption, the union budget will have to make good the shortfall to honour its commitment. That’s the risk of a guarantee which is what the 2004 pension reform bypassed. UPS effectively takes on the risk again which has to be backstopped by tax payers
TRENDS
Rice inflation is not a supply problem, but one of poor management by government
Currently, we have a situation where paddy/rice inflation is largely a problem of distortions in the market introduced by governments, both centre and some states
BUSINESS
MPC is way behind the curve; policy rate is too high
Since April-June 2022, inflation has been driven primarily by supply side shocks. It hasn’t spilled over as core inflation is at a record low. Voting status quo hurts the economy’s productive capacity
BUSINESS
Near-term consumption kicker in Budget 2024
Budget 2024-25: Fiscal benefits for creating new jobs and changes in the new income tax regime will put more money in the hands of a demographic with high propensity to consume
BUSINESS
Economic Survey projects conservative growth forecast for FY25, but leaves jobs and private investment puzzle unanswered
India’s GDP level is at the pre-pandemic trajectory, the Economic Survey reveals. It means that the speed of the GDP expansion has ensured no permanent loss in output and demand. Though, employment remains a crucial link between growth and prosperity
BUSINESS
Karnataka’s domicile-based reservation is a bad idea that will fail in court
Similar reservation by Haryana was struck down. Skilling mismatch in the job market is a challenge. But reservations are not the solution
BUSINESS
Reducing the proportion of cesses in tax collections will allow the budget to produce a bigger bang for the buck
Budget 2024: Capex undertaken by states leads to a bigger multiplier than centre’s investments. ‘Divisible pool’ of taxes needs to be higher
BUSINESS
MSP announcements didn’t pander to farmers. But NDA’s welfare promise makes it impossible to ignore them
Modi 3.0 has built its welfare commitments on the foundation of five years of free cereals. It makes the current-pattern of MSP sticky
BUSINESS
Indexing tax slabs to inflation is a fair way to treat tax payers
Inflation erodes the value of money and brings people at lower levels of income into tax net because slabs are adjusted infrequently. Tax payers deserve better
POLITICS
Naidu’s real test will be getting a special financial package for Andhra. Cabinet posts not so important
Cabinet portfolio allocations are not the correct measure to judge the leverage TDP has extracted from the coalition government. It could be because the real test for N Chandrababu Naidu will be the concessions he extracts for Andhra
