ECONOMICS Round up - The week that was (3rd October 2015) Key Issues Solve - Black money law, state of the economy, the re...

This is the first time a government has taken a strong position on black money. Key issues on black money resolved by Modi Government which was not taken care off by previous Government like in the very first meeting of the Cabinet Modi Government constituted the Special Investigation Team, an initiative at the G20 for sharing of information, India has become a signatory to Fatca, negotiations with the Swiss authorities for sharing of information and the Swiss are cooperating. Accordong to India's Finance minister, Rs 3,770 crore was declared by 638 persons under the three month window for compliance which is one of the important successful parameter of the Modi Government. The NDA government is also putting efforts to levy xes on income held abroad.

To Curb black money the NDA government has taken many steps. It will be very difficult for people having (undisclosed) assets abroad to hide their footprints. E-commerce is a reality. Payment gateways, payment banks will encourage more and more transaction through plastic money and that will make transactions transparent. All 18 crore Jan Dhan account holders, have RuPay cards. That economy too will become transparent.

Big Jump in FDI : Between 2011 and 2014, US FDI equity inflows into India was $2.4 billion. But between June 2014 and June 2015, US FDI into India jumped to $2.2 billion, which basically means that in one year, US investment has been the same as it was in the three years before that.

Rate Cut : Over the last 16 months of the NDA government the rates have come down by 125 basis points. It is very encouraging that inflation is under control. There may be stray items which become costlier because of weather or production shortfalls, but by and large, inflation is under control. Therefore capital is going to become increasingly more affordable. This will help in generating demand, it will also help spurring investment and be of considerable aid in the growth potential. We are going to be increasingly vigilant on two counts, one on watching that inflation does not pick up and two keeping the fiscal deficit under control.

Now the most important event for the next couple of month is a Bihar Election. A win in Bihar elections will be very positive for the NDA government. Every win in a state changes the composition in Rajya Sabha. Those who obstruct must be made to pay by the electorate.