Indian economy’s growth for the quarter ended Dec’19, as per the data released by MOSPI today, presents a complex picture. GDP growth is marginally better than initial estimates of Sept’19 quarter giving reason to believe that economy has bottomed out. However, there is a catch. Growth for previous two quarters has been adjusted upwards by as much as 0.5 percentage points, which makes this another quarter of growth decline. (What if this quarter also sees an upward revision later?). Whichever way it is approached, it is clear that economy is still in distress and recovery, if at all it has begun, would be a slow and long drawn one. Here is a look at the details of what is pulling it down. Continue reading GDP Growth – Dec’19 Performance Analysis
OECD (Organisation for Economic Co-operation and Development) is engaged in, possibly, the most complicated task in its history. And the task is – how to make the new age, digital companies pay fair share of their taxes. More importantly, how to apportion it to countries which are contributing to these company’s revenues. The OECD task … Continue reading OECD’s Challenge – Taxing Digital Giants
The visit by the US president, the fifth successive (including two visits by Barack Obama) in last twenty years contrasts with only three visits by US president during 1950-1999. Even though India is a marginal player economically, it has successfully established itself as a responsible democracy and an intellectual powerhouse, earning for itself a unique … Continue reading Indo-US Relations – Economic & Other Aspects
If the first term of NDA government was defined by the fight against parallel economy, the second term is possibly looking at simplification of tax regime as another of its objective. Two announcements related to direct taxes bear this out. First, cut in corporate tax rate announced in Nov’19 was made available only to those … Continue reading Simplification of Tax Regime – Desired or Not?
The decision by two of the top audit firms not to take non-audit work for their audit clients, is the culmination of regulatory efforts to improve the standard of corporate governance. However, the immediate trigger is a discussion paper, floated by MCA (Ministry of Corporate Affairs), which proposes a variety of measures to make audit procedures more independent. Here is a look at the issues raised and proposals suggested by the paper. Continue reading Towards Better Corporate Governance – Strengthening Audit Framework
The AGR (Adjusted Gross Revenue) woes has come back to haunt the telecom companies with the Supreme Court refusing to grant any relief to the companies. While Airtel appears reasonably well placed, things looks quite tough for Vodafone Idea. Here is a look at the company, its financials and why things could be tough for … Continue reading Vodafone Idea – Braving the AGR Crisis…
A term being deliberated upon a great deal after this year’s budget is “extra budgetary resources (EBR)”. Essentially, it is an accounting adjustment which helps government take some of its expenses off the annual budget and thus, show a lower deficit. So, what exactly is EBR, how government gets it and how it helps. Here is a look. Continue reading Extra Budgetary Resources (EBR) – Who Foots the Bill?
The report of 15th Finance Commission, tabled in the parliament on the day of the budget, was lost in the din of budget. The Finance Commission (FC) is an important constitutional body which helps preserve the federal structure of the nation. Its basic objective is to recommend allocation of funds from total tax revenue between … Continue reading Finance Commission Report – Understanding the Formula for Devolution to States
Real estate sector is among the most hit and most talked about sector amidst the current slowdown. However, property prices haven’t corrected sufficiently despite the stress across all the affected segments, banks, NBFCs and the developers themselves. The stalemate has forced the Economic Survey to advise developers to take a ‘hair-cut’ to revive the market. … Continue reading Real Estate Sector – Down but Not Out!
The first and the most important figure economists and all analysts look at while analyzing the budget is the fiscal deficit (FD) as a percent of GDP. For FY20, FD has been revised up sharply from 3.3% to 3.8%, a result of significantly lower revenue mop-up. For FY21 also, it is projected to remain high at 3.5%. Other than that, budget also throws up other deficit numbers such as primary deficit, revenue deficit and effective revenue deficit! So, what all are these deficits and their importance?? Here is a brief look. Continue reading Understanding Deficit Terminologies