The secretary of economic affairs hopes that the new flow of money abroad to government values will reduce interest rates in the system. In an interview with Surojit Gupta and Sidhartha of TOI, he suggests that the small savings rate on instruments such as PPF can be reduced as of April, while maintaining that the government needs to protect the interests of older people and girls. Excerpts
Does the budget address the concerns of the slowdown?
Yes, in more than one measure, in a very substantial and very strategic, concerted and planned manner.
There is an apprehension that the taxpayer has not put enough money to boost consumption ...
Live plus the speech talks about boosting through investment and enhancing purchasing power. Somehow, economists in India have got used to seeing one to one allocations. On the demand side, income tax is one of the demand boosters. Then, there are things like doubling farmers’ income through steps like linkage to the market. We are ready with the , which is fully provided for with a list of 6,500 projects and their details. There are steps on long-term finance, there is additional funds for capex. Today, most of the bond money moves through indices through passive investment. We have to attract that money. Four categories of government of India bonds will be opened up for non-resident float as well as domestic float which means larger amount of money. Whenever you have fungibility of money, rates come down. When that rate is reduced, monetary policy transmission becomes plus efficient, then it moves very quickly to banks. We had closed our doors and Lakshmi was standing outside. Now, the government has opened the doors. If Kuber wants to give, then you have to have your doors open. Open it slightly but at the same time be careful.
the It has been around for a while. What is the progress?
It has already disbursed Rs 16,000 crore and has a portfolio of Rs 38,000 crore. They have established an infrastructure debt fund and now they have established an NBFC, where we plan to provide capital. They have also been linked to sovereign wealth funds that want to come from the debt side.
If you look at the allocation of several sectors, such as MGNREGA, there is not much increase.
Todo el mundo viene a MGNREGA. No es un generador de empleo clásico a largo plazo, es por eso que su naturaleza se ha modificado ligeramente cuando hablamos de granjas forrajeras. Tiene que ser empujado a la generación de activos, de lo contrario es un desperdicio de dinero de the contribuyentes.
One issue that is discussed when we refer to monetary transmission is the issue of small savings rates. Is there any movement to review them since the government has not changed the rates?
I don't think this is a budget problem. Wait for the quarterly restart, you will get the answer. All questions are to lower interest rates. At the same time, we have a certain responsibility towards older people and girls.
The rating agencies have raised some concerns about the fiscal deficit of 3.8% of GDP. You are worried?
En lo que respecta a las agencias de calificación, es natural que se preocupen. También les gustaría ser tranquilizados. Cuando the conozca, mi respuesta sería hasta ahora hablamos. Vea la prueba del budín cuando termine el año. Puede ser, nuestra articulación con ellos en esta etapa necesita alguna mejora. Necesitamos hacer eso. No hay nada contencioso. También debemos darles pruebas de nuestro compromiso con la consolidación fiscal.