India gets the mix bag for economy during 2017.At one hand constant
reforms done by the government improved credit ranking, and attracted huge
investments on the other hand, the government tackles with issues as Budget
deficit, lower tax bases, high public expenditures and increased debt on the
government. According to MOODY’s Report, The debt burden on Indian government
is almost 68% of its GDP which will grow by 1% next years.
Above all problems, the core reason for worry remains
the Budget Deficit, it is a situation when the government expenditure exceeds revenue.
In simple terms, the government has lesser income than expenses.
India’s Budget Deficit occurs mainly due to following economic reasons—
1 . Low tax base
2. Higher Spendings
The Impact of Budget Deficit- India’s ranking could have improved more,
if we have lesser burden of debt, which keeps on growing every year. This was
mentioned by the International credit Rating Agency MOODY’S as well.
The government appointed panel has even recommended that India should
reduce debt from present to 60 percent of GDP by 2023. The government has also
been trying to enrol more people under the tax net as well cutting the public
expenditures.
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