(The Gist of PIB) Macro-economic Framework Statement  [FEBRUARY-2020]

(The Gist of PIB) Macro-economic Framework Statement

Macro-economic Framework Statement

• Macro-economic Framework Statement (MFS) 2020-21 predicts rebound in GDP growth from first quarter of 2020-21.

Key highlights:

• The Macro-economic Framework Statement (MFS) 2020-21 describes the return path of fiscal consolidation without compromising the needs of investment out of public funds.
• The government has revised the fiscal roadmap in the near term and limited the fiscal deficit to 3.8% of the GDP in RE 2019-20 and 3.5% in 2020-21.
• The consumer price inflation has remained within the targeted limits set by the Monetary Policy Committee (MPC) of the RBI and the government is expected to return to the glide path of fiscal consolidation in the medium term.
• The Finance Minister proposed a 21% increase in capital expenditure for the FY 2020-21. Level of expenditure has been kept at Rs. 30.42 lakh crores in BE 2020-21, as compared to Rs. 26.98 lakh crores in RE 2019-20.
• To improve the physical quality of life, the Government has also announced the National Infrastructure Pipeline (NIP) of projects worth Rs. 102 lakh crores, which would commence in phases from 2020-21 to 2024-25.
• Global economic growth is expected to pick up in 2020 which could also support India’s growth. In view of a positive outlook on economic rebound, the MFS predicts the nominal growth of the economy at 10% in FY 2020-21.

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Courtesy: PIB