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Centre: No plan for Covid-19 bonds to raise fiscal resources

Niti Aayog vice-chairman Rajiv Kumar, Former RBI governor D. Subbarao, and the PHD Chamber of Commerce and Industry had all proposed such bonds
Representational image.
Representational image.

Our Special Correspondent   |   New Delhi   |   Published 20.07.21, 12:58 AM

The Centre on Monday said it has no plans to come up with Covid-19 bonds to raise fiscal resources amidst suggestions on such bonds by experts.

“The government does not plan to raise fiscal resources through borrowings by issuing Covid bonds,” minister of state for finance Pankaj Chaudhary said in the Lok Sabha on Monday to a written question.

Niti Aayog vice-chairman Rajiv Kumar earlier this month had said “well give it whatever name you like, the point is that if the government needs to borrow more money for expanding capital expenditure, it could go ahead because that will attract more private investments”.

Former RBI governor D. Subbarao had also proposed Covid bonds. He said the bonds could provide relief to savers “who are short-changed by the low-interest rates on bank fixed deposits”.

PHD Chamber of Commerce and Industry (PHDCCI) had also suggested the government should issue special Covid bonds to raise funds for providing stimulus. “The issuance of special Covid bonds could be an appropriate substitute to market borrowings by the government,” it said.

Oil price

The Opec+ pact to raise output will have little effect on fuel prices in the country. Unless the Modi government blinks on duties, consumers are unlikely to get any relief, analysts said. Government revenues ballooned 88 per cent to Rs 3.35 lakh crore in the last fiscal from petrol and diesel excise duties.

The benchmark Brent on Monday dropped 6.31 per cent to $68.63 per barrel following the agreement among the members of the oil cartel.

Madan Sabnavis, chief economist of CARE Ratings, said for every $5-per-barrel drop in Brent price the final price of petrol will come down by Rs 3.58 per litre. “Quite clearly the government has to give in somewhere if we want to reduce the price significantly to have an impact on price and overall inflation. We do not believe that this will be too beneficial for us.”

Vivad se Vishwas

Over 1.32 lakh declarations entailing disputed tax of Rs 99,765 crore have been filed under the “Vivad se Vishwas” dispute resolution scheme, Parliament was informed on Monday. The declarations  cover around 28.73 per cent of the pending direct tax disputes.

The total number of pending tax disputes as on the eligibility date was 5,10,491.

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