What is the impact of fiscal deficit target adherence on India's growth risks, as per CII's request to the Centre
The CII urges the Centre to stick to fiscal deficit target to avoid growth risks.
- Adhering to fiscal deficit targets ensures financial stability and credibility in the eyes of investors, which in turn helps in maintaining low interest rates and attracting foreign investments.
- Sticking to fiscal deficit targets also promotes responsible fiscal management, leading to long-term economic sustainability and growth.
- Failure to adhere to fiscal deficit targets can result in inflation, high borrowing costs, and a weaker currency, all of which pose risks to economic growth and stability.
- A high fiscal deficit can crowd out private investments and divert resources away from crucial sectors like infrastructure development and social welfare programs.
- By maintaining fiscal discipline, the government can better allocate funds towards productive investments that can contribute to sustainable economic growth.
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5 months ago