Photo: Aniruddha Chowdhury/MintMumbai: India’s central bank described the government’s spending on the health and education sectors in its federal budget as “woefully” below peers. The effort is simply not enough, if one were to go by the gist of the central bank report. That move, however, came at a cost and one which would have broader implications including “on economy-wide costs of borrowing,” the RBI said. Last week, the central bank kept rates unchanged but warned the fiscal slippage could have a crowding out affect. The budget “is confronted with a tight trade-off between the rigors of fiscal consolidation and the demands for stimulating the economy,” the RBI said.

Source: Mint April 11, 2018 11:15 UTC