-The Economist Government borrowing generates inflation, widens the external deficit and crowds out much-needed investment. Can India now overcome its debt addiction? INDIA has grappled with its public finances for long enough. When presenting its first budget after independence in 1947, the finance minister of the day insisted that the country was not living beyond its means. Yet every budget since has failed to produce a surplus. India borrows more heavily...

Token relief to individual taxpayers will cost the exchequer Rs. 4,500 crore In a “pragmatic and domestic growth-oriented” budgetary exercise aimed at shoring up investor confidence and investment, Union Finance Minister Pranab Mukherjee on Friday sought to tap indirect taxes, especially service tax, to rake in an additional Rs. 45,940 crore into his kitty. Presenting the budget for 2012-13 in Parliament, Mr. Mukherjee provided a token relief to individual taxpayers that will cost...

Global retail chains looking to set up shop in India may face several challenges such as delay in the implementation of goods and services tax and restrictions imposed by the Agricultural Produce Marketing Committee (APMC) Act, besides political opposition. These hurdles can be roadblocks in providing real benefits to farmers and consumers as intended by the government in opening the multi-brand retail sector to foreign direct investment. “GST (goods and services tax)...

-The Hindu   Tamil Nadu Chief Minister Jayalalithaa on Saturday criticised the Central government for seeking to reduce States into the status of “glorified municipal corporations.” In her address to the National Development Council, which met in New Delhi, the Chief Minister, whose speech was read out by Finance Minister O. Panneerselvam in absentia, said that the NDC was a forum to consult with State Chief Ministers, as equal partners in the process...

The government's move to make tax evasion a criminal offence has drawn strong criticism from former policymakers and commentators, who say if such a move is implemented it will hurt economic activity, undo years of tax reforms and increase harassment. A panel headed by Central Board of Direct Taxes chairman Prakash Chandra, which held its first meeting on Thursday, will examine the proposal. The proposal appears to have been made because...