The Economic Challenges in front of India at present? - Seeker's Thoughts

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The Economic Challenges in front of India at present?

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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