Ajay Seth Talks About India’s Fiscal Plans and Foreign Investments
Ajay Seth, Secretary at the Department of Economic Affairs under the Ministry of Finance, discussed India’s fiscal consolidation efforts and foreign direct investment (FDI) during the Union Budget presentation.
Fiscal Consolidation
Seth explained that fiscal consolidation is being achieved while meeting all essential and priority expenditures, including new initiatives like employment in skilling. The fiscal deficit target for 2024-25 is set at 4.9% of GDP, better than the 5.1% estimated in the Interim Budget. The government aims to reduce the fiscal deficit to below 4.5% by 2025-26.
Foreign Direct Investment
Addressing the decline in FDI, Seth noted that most FDIs are approved through an automatic route and emphasized the need to create favorable conditions for investment. He mentioned that India’s net FDI inflow dropped by 62.17% to USD 10.58 billion during the financial year 2023-24. However, he clarified that the gross FDI was not significantly lower than in previous years. Seth also highlighted the government’s efforts to improve the ease of doing business in India, making it easier for foreign investors to set up operations.
Doubts Revealed
Ajay Seth -: Ajay Seth is a senior government official in India. He works as the Secretary at the Department of Economic Affairs, which deals with the country’s economic policies.
Fiscal Plans -: Fiscal plans are the government’s plans on how to manage its money, including how much to spend and how much to collect in taxes.
Foreign Investments -: Foreign investments are when people or companies from other countries put their money into businesses or projects in India.
Department of Economic Affairs -: This is a part of the Indian government that focuses on the country’s economic policies and financial management.
Union Budget -: The Union Budget is a yearly financial statement presented by the Indian government, showing its planned income and spending for the coming year.
Fiscal Consolidation -: Fiscal consolidation means the government is trying to reduce its debt and manage its finances better.
Fiscal Deficit -: Fiscal deficit is when the government spends more money than it earns. It is usually shown as a percentage of the country’s total economic output, called GDP.
GDP -: GDP stands for Gross Domestic Product. It is the total value of all goods and services produced in a country in a year.
FDI -: FDI stands for Foreign Direct Investment. It is when people or companies from other countries invest directly in businesses or projects in India.
Ease of Doing Business -: Ease of doing business means how simple and friendly the rules and environment are for starting and running a business in a country.
