STOCK MARKET BSE NSE

India seeks nod to up net spending by $5.2 billion

The request comes after the latest data showed a healthy 7.3 percent expansion in the Indian economy over the September quarter

Published: 07th December 2016 01:23 PM  |   Last Updated: 07th December 2016 01:23 PM   |  A+A-

Arun Jaitley_Reuters

Finance Minister Arun Jaitley.(File | Reuters)

By Reuters

NEW DELHI: Finance Minister Arun Jaitley sought parliamentary approval on Wednesday to increase net spending by 351.7 billion rupees ($5.2 billion) in the current fiscal year that ends in March 2017.

The supplementary demand for more funds, the second to come before the Lok Sabha, had been expected for some months. In August, lawmakers had approved $3.1 billion in additional spending for the current fiscal year.

The request comes after the latest data showed a healthy 7.3 percent expansion in the Indian economy over the September quarter was led by state spending, while investment and private consumption were weak.

Prime Minister Narendra Modi's government must also contend with the fallout from his dramatic decision a month ago to abolish high-value banknotes accounting for 86 percent of the cash in circulation.

The bid to purge the economy of "black cash" - undeclared income and the proceeds of corruption or racketeering - has caused huge economic disruption, making government spending a key prop for Asia's third-largest economy.

The extra spending includes 40 billion rupees for a rural jobs programme, 31 billion rupees for the farm ministry and 11 billion rupees to cover a higher pensions bill, according to the request which is likely to be approved because the lower house has a large government majority.

The supplementary demand also sought parliamentary approval to cover the cost of repayment obligations under the so-called Market Stabilisation Scheme, a facility run by the Reserve Bank of India to absorb up to 6 trillion rupees that have flowed back into the banking system following the so-called demonetisation.

Jaitley, when he unveiled his annual budget in February, earmarked 19.78 trillion rupees ($291.4 billion) in total spending, up 11.6 percent from the prior year. He will unveil his next budget at the beginning of February.

Stay up to date on all the latest World news with The New Indian Express App. Download now

Comments

Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the newindianexpress.com editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on newindianexpress.com are those of the comment writers alone. They do not represent the views or opinions of newindianexpress.com or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. newindianexpress.com reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp