HIGHLIGHTS OF ARVIND SUBRAMANIAN’s SPEECH
• Demonetisation has affected aggregate demand and aggregate supply
• There is genuine uncertainty on how the economy performing
• Wheat production has gone up to 7%, and main pulse is up by 10%
• Indirect tax collection has seen a dip
• There is a decline in the real estate price, purchase, launches, but that was the aim so that the equilibrium is achieved in India
• Two-wheelers sectors has seen a huge dip because demand for rural India has seen a setback
• Land should be included under the ambit of GST
• Need to reduce tax and stamp duties
• Investments, credit, cash investment, has suffered a setback
• Consumption should increase as remonetisation happens
• Consumption and government has been the drivers of growth in India
• There is a festering twin balance sheet problem that is affecting private investments
• Overall private investments declining. Investments in negative and that is worrisome.
• For bank credit, real credit from corporate sector to industry is declining
• But personal loans to consumers is increasing in double digits
• India may need a Public Sector Asset Rehabilitation Agency.
• Oil prices could go higher. Macro fiscal escalation will also increase.
• Trade tensions with China possible.
• If the world economy picks up, then outlook could be better than what projected so ar.