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IMF wants India to be more transparent on fiscal numbers
08 Nov '19
2 min read
Pic: Shutterstock
India needs to be more ‘transparent’ on fiscal numbers as it is a ‘laggard’ among the G20 peers on this front, International Monetary Fund’s (IMF) deputy director Anne-Mary Gulde told an event in Mumbai recently. The government has been missing its budgeted fiscal targets for the past few years and there is a need for a ‘credible fiscal consolidation’, she said.
The event was organised by the National Stock Exchange. The government is yet to address how it will make up for the massive ₹1.45 lakh crore tax giveaways in the form of corporate tax cuts, she said.
"Fiscal transparency should be increased. It is fairly difficult for the private sector to get the full picture on fiscal standing," she was quoted as saying by a news agency.
"India is somewhat lacking in a programme on G20 data initiative on fiscal transparency where comparative countries have all made greater progress," she added.
There is also a need for more credible fiscal consolidation as such a move will help reduce the relatively high level of debt and free up financial resources for the private sector, she said.
Fiscal stimulus is not possible to revive the sagging growth due to the relatively high level of public debt compared to the emerging economy peers, she said.
She also advocated using monetary policy tools to support the recovery and asked for the same to continue till revival is achieved, adding growth would have fallen further in the second quarter than the previous one.
"We see structural challenges and a weak cyclical position; we need to look at policies that address the cyclical weakness which will also address the structural challenges going forward," she said and called for urgent reform measures in the labour, land and factor markets to revive and sustain growth.
The IMF official said the ongoing mergers of public sector banks must be done ‘cautiously’ and pitched for a relook at both governance and efficiency of capital allocation at state-run lenders.
The event was organised by the National Stock Exchange. The government is yet to address how it will make up for the massive ₹1.45 lakh crore tax giveaways in the form of corporate tax cuts, she said.
"Fiscal transparency should be increased. It is fairly difficult for the private sector to get the full picture on fiscal standing," she was quoted as saying by a news agency.
"India is somewhat lacking in a programme on G20 data initiative on fiscal transparency where comparative countries have all made greater progress," she added.
There is also a need for more credible fiscal consolidation as such a move will help reduce the relatively high level of debt and free up financial resources for the private sector, she said.
Fiscal stimulus is not possible to revive the sagging growth due to the relatively high level of public debt compared to the emerging economy peers, she said.
She also advocated using monetary policy tools to support the recovery and asked for the same to continue till revival is achieved, adding growth would have fallen further in the second quarter than the previous one.
"We see structural challenges and a weak cyclical position; we need to look at policies that address the cyclical weakness which will also address the structural challenges going forward," she said and called for urgent reform measures in the labour, land and factor markets to revive and sustain growth.
The IMF official said the ongoing mergers of public sector banks must be done ‘cautiously’ and pitched for a relook at both governance and efficiency of capital allocation at state-run lenders.
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