Doctor146;s injection

Tax giveaway due to 4 per cent cut in Cenvat as percentage of GDP

Rs 8,700crore 0.17 per cent

Extra sops for exports as percentage of exports of 175 billion this fiscal

Rs 1,800crore 0.2 per cent

Core-sector boost runs short

IIFCL will raising Rs 10,000 crore to facilitate Rs 1,00,000 crore PPP projects in infrastructure. But India8217;s investment needs in infrastructure are Rs 5,00,000 crore a year.

YES OR NO

Is the package adequate?

NO The only significant move to stimulate demand has been the 4 percentage point cut in Cenvat rate. The economy is likely to see a sharp slide in the coming two quarters.

Then is it totally disappointing?

NO Economists hope this is the first in a series of more such fiscal measures. Montek Singh Ahluwalia himself says government will step in as and when needed.

Could it have been better?

yes 038; No No, say the purists, since there is little fiscal headroom to spend more or cut down on revenues. Yes, say others, because this is a special situation and the government can worry about deficits later.

Will it have any real impact?

yes It will start stimulating demand in the long run. This year, economy will grow 7 per cent, a little less or a bit more. Fiscal deficit will certainly be higher than the 2.5 per cent of the GDP as estimated in the Budget.

ON ECONOMY

8220;Fortunately, the Indian economy is in much better shape than most others. But we cannot be complacent. We want to take action in advance of any problems arising so that factors that would otherwise weaken our growth performance are minimised.8221;

ON GROWTH

8220;Seven per cent growth rate is quite feasible8230; 7 per cent would be a good performance. The government will absorb a revenue loss of Rs 8,700 crore in the next three months due to the 4 per cent cut in Cenvat. The fiscal deficit will worsen.8221;

ON SPENDING

8220;Expenditure every year takes place in the last quarter. What we are saying now is because of a different situation this year we will make special efforts to make sure not just the additional spending which is up to 20,000 crore 4 billion but we will make special efforts to make sure that what is there in the budget also gets actually spent.8221;

ON FISCAL DEFICIT

8220;It is quite clear that the fiscal deficit at the end of this year will be larger than the fiscal deficit at the time the budget was presented. It is a desirable step. So the fiscal deficit will be worse. We don8217;t have a number what that will be.8221;