Professional Documents
Culture Documents
Policies of INDIA
Fiscal Policy???
1.
Direct taxes- Corporate tax, Div.
Distribution Tax, Personal Income
Tax, Fringe Benefit taxes, Banking
Cash Transaction Tax
2. Indirect taxes- Central Sales Tax,
Public Debt
Internal borrowings
1.Borrowings from the public by means of
treasury bills and govt. bonds
2.Borrowings from the central bank
(monetized deficit financing)
External borrowings
1.Foreign investments
2.International organizations like World
Bank & IMF
3.Market borrowings
Budgetary Surplus &
Deficit
Early 1980s:net of depreciation
consistently negative.
Late 1980s:large deficit averaging
about 8% of GDP
Post liberalization: Fiscal deficit
decreased.
LPG effect was till 1996-1997
2001:Fiscal deficit increased to 10%
of GDP.
Monetary Policy??
CENTRAL BANK
SECURITIES AND TRESURY BILLSBANK RATE INC CASH RESERVE RATIOSTATUTORY LIQUID RATIO
RR
CASH
N C
REA RATE
SO
LD
SE
SE I
%
LEN
EA
DIN
INCR
G
COMMERCIAL BANKS
REDUCE LIQUIDITY IN
CORPORATES MARKET INDIVIDUALS
Monetary Policy of India - Overview
The Monetary Policy aims to maintain price stability, full
employment and economic growth.