Chetan Ahya, Chief Asia Economist, Managing Director, Morgan Stanley expects the Finance Minister Arun Jaitley to stick to fiscal consolidation plan. The fiscal deficit target for FY17 is likely to be 3.7% and the nominal gross domestic product (GDP) growth to be around 11 percent, says Ahya.
He also expects government to be increase capital expenditure by around 10 percent that is the capital expenditure to GDP would increase by around 0.1 percent.
According to him they will also watchout for some clarity on the plans to recapitalise banks. Appointment of Vinod Rai as the chairman of Banks Board Bureau is a positive, says Ahya.
Ahya says the realistic divestment target is around Rs 35,000 crore, which is is achievable and anything additional would be an upside.
The tax revenue growth is estimated around 13-14 percent, says Ahya.
However, he believes the current global environment is not conducive for India and is hurting the economy.Watch accompanying video for more details.
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