[BES16] Economic Survey → Budget-2016→7th Pay Commission, can’t JAM-DBT everything, Disinvestment, CSS-restructuring, FRBM Review

1. Prologue
2. BES162-P06: 7th Pay Commission Report, IAS “Edge”,OROP,HRA-Inflation
3. BES162-P07: We can’t JAM-DBT every Scheme because
4. BES162-P08: Disinvestment- Theory & Current, Budget-2016 Target
5. BES162-P09: Restructuring Centrally Sponsored Schemes (CSS)
6. BES162-P10: Fiscal Deficit- Theory & Current, Budget-2016 Target

Prologue

• Previous lecture, we had finished upto revenue Expenditure.
• This part covers the remaining port and thus Economy pillar#2 – budget and fiscal policy is over.
• Powerpoint available at http://Mrunal.org/download (Go to mediafire => powerpoint => Mrunal =>2_Budget Folder)

BES162-P06: 7th Pay Commission Report, IAS “Edge”,OROP,HRA-Inflation

• recap of the previous lecture- up to tax and non-tax revenue receipts of the government
• part of budget: revenue expenditure and non-plan expenditure
• major components of non-plan expenditure- in decreasing order.
• 7^th Pay commission: theory, salient features, list of beneficiaries, which department implements this report, will the award of 7^th pay commission increase inflation in India? Provisions related to house rent allowance, interest bearing advances and interest free advances.
• What are the views of 7^th Pay commission and Justice A.K.Mathur on the “edge” enjoyed by Indian administrative service (IAS), one ranked one pension scheme (OROP) and performance based pay?

Youtube Link: https://youtu.be/kOzlJw-7q9E

BES162-P07: We can’t JAM-DBT every Scheme to reduce Subsidy Leakage because

• major subsidies in India and their descending order in budget 2016
• overall subsidy has declined in budget 2016 compared to the revised estimate of 2015, why and how?
• Science-tech Theory about liquefied petroleum gas (LPG)
• Steps taken to reduce the petroleum subsidy bill in India- new measures related to Pahal-DBT for super-rich and PM Ujjwalla Yojana for BPL households in budget 2016
• Role of first mile, middle mile and last mile delivery points in success of direct benefit transfer (DBT) in any scheme.
•  “O” Ring theory of US Economics Michael Kremer and JAM preparedness index of India for urban and rural region.
•  Why BAPU- Biometric Authenticated Physical update (BAPU) is more suitable for certain scheme than JAM-DBT?
•  JAM vs BAPU: Why delivery route is more suitable for food subsidy, kerosene subsidy and fertilizer subsidy? What has Economic survey recommended? What has Government implemented?

Youtube Link: https://youtu.be/Pln25MRScs4

BES162-P08: Disinvestment- Theory & Current, Budget-2016 Target; ETF, OFS, IPP

• part of budget: capital receipts- debt and non-debt receipts
• breakup of India’s sovereign debt- internal versus external, short-term versus long-term
• What are the non- debt capital receipts of the government?
• Disinvestment: argument in favour and against, timeline of disinvestment in India since LPG crises of 1991
• three prevalent methods of disinvestment in India: exchange traded funds (ETF), institutional placement program (IPP), offer for sale (OFS)- and their salient features.
• Disinvestment target of Rs. 56,500 in Budget 2016- how will it be achieved?
• What is the meaning of strategic disinvestment?
• Why did the government of the name Department of disinvestment in Department of investment and public asset management (DIPAM)?

Youtube Link: https://youtu.be/hj2DROj-6q0

BES162-P09: Restructuring Centrally Sponsored Schemes (CSS)

• In budget 2016, government has decided to work with the plan and non-plan expenditure classification from 2017, why?
• Classification of 27 Restructure centrally sponsored schemes.
• What are the “core of the core”, “core” and optional schemes? What is the funding mechanism for sharing formula in them?

Youtube Link: https://youtu.be/n8pQkncITRQ

BES162-P10: Fiscal Deficit- Theory & Current, Budget-2016 Target

• let’s calculate the budget deficit, fiscal deficit and primary deficit in budget 2016.
• What is monetised deficit?
• Why is high level of the fiscal deficit bad for an economy?
• Fiscal responsibility and budget Management (FRBM) Act 2003- original and extended deadlines.
• How does Modi government plan to contain the fiscal deficit at the percent of GDP by the year 2017-18?
• Why is government of India constituting an expert panel to review FRBM Act? Why should we have a “range” rather than fixed targets for fiscal deficit?

Youtube Link: https://youtu.be/hE5l-i1Qfig
Next lecture: Economy Pillar#3: Balance of Payment, WTO Nairobi Package.
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