ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Labour versus Labour

Echelons of labour in the production process are investigated. There is labour directed at the flow of output. Unproductive work also exists. It is concluded that the government expenditure supports production, and the taxation of unearned incomes should be 100%.

The Making of an Economic Crisis in Pakistan

In order to break away from the neo-liberal debt servitude, Pakistan needs a strong political will to make structural changes to its political economy. Policies centred on working people and their needs should be privileged over the International Monetary Fund’s one-size-fits-all (non)-solution that it con­tinues to advocate in developing coun­tries.

Waning Business Confidence

Only a substantial step-up in savings and investments can ensure sustained growth.

Fiscal Situation of India in the Time of Covid-19

India announced a fiscal package worth `1.7 trillion to fight the COVID-19 pandemic, but there were arguments for more spending. Using data from a cross-section of countries, this paper estimates the relationship between fiscal spending and the spread of COVID-19, economic stringency, and macroeconomic factors. It argues that subsidy rationalisation is the way to fund the increased expenditure on health and direct transfers while maintaining fiscal discipline.

The Role of Finance Commissions in Intergovernmental Fiscal Management

Fiscal imbalances, both vertical and horizontal, are common to federations and India is no exception. The Indian Constitution provides for instruments—shared taxes and grants-in-aid—to address such imbalances and an institutional mechanism—the finance commissions with specified terms of reference—to negotiate such imbalances. The paper addresses how 14 different FCs have dealt with their constitutionally assigned roles and strengthened the fabric of fiscal federalism in India. It further examines how the role of FCs were enlarged with additional terms in the interest of sound finance. It discusses, as an illustration, how FCs have addressed one of the major fiscal concerns, restoring budgetary balance and maintaining macroeconomic stability in the economy.

 

Utilisation of Government Borrowings in Major Indian States

Fiscal sustainability is a key element for subnational governments in India as fiscal policy is the only instrument that can be used to correct economic malady. As far as state government finances are concerned, subnational financial stability can be understood as the capacity to generate adequate resources to afford their expenses on a sustained basis. An analysis of subnational fiscal sustainability, through a study of utilisation patterns of total debt receipts of state governments, is undertaken for 17 major Indian states during 1980–81 to 2014–15. The results indicate wide fluctuations among the states. While Kerala, Punjab, and West Bengal have shown poor and unproductive utilisation of debt receipts, Punjab has witnessed maximum instability.

 

Fiscal Space and Union Budget 2020–21

This article points out some drawbacks in the criticism of the Union Budget 2020–21. It notes that the critique suffers from some limitations, ranging from oversimplified solutions, analytical deficiencies and outright factual errors.

 

The Indian Economy

Deadly and frightening as it appears, it is still too early to estimate the severity of India’s Covid-19 second wave. Unlike the transatlantic countries where it appears to have peaked, India’s second wave is still trending upwards. While the second wave is more devastating, India’s unpreparedness is evident. India needs to recognise that such pandemics will come again. It needs to diversify and secure its supply chains, vaccine output, and upgrade its poor healthcare infrastructure. The Indian economy has been badly hit by the pandemic, with one of the highest output losses amongst major economies. One of the possible reasons for this is the limited fiscal support despite a stringent lockdown, with most of the heavy lifting done through monetary measures. Going forward, its economy needs to overcome several challenges before it can return to its former high growth trajectory.

 

Falling behind the Curve Is Not an Option

India must jettison orthodox economics amidst the pandemic to protect employment and sustain a recovery.

 

Garnering the Fiscal Stimulus

The share of resources distributed in the stimulus package to the farmers and labourers is very less as compared to other stakeholders of the economy. As public policy is influenced by bargaining power through intense lobbying, low distribution of resources towards farmers and labourers could be due to their low bargaining power. Collective action is required to bargain or lobby for resources. The farmers are adversely placed with regard to collective action because the transaction cost of organising collective action is higher but their ability to bear the cost is lower. The industry is placed in a much better position on both these counts. The inability of farmers to provide critical minimum resources for collective action may further weaken their bargaining position.

 

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