DMPQ- Owing to low growth rate, the government has taken some steps to improve the investment and consumption climate. Enumerate the steps.

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Always keep in mind the following equation for writing answer:

Overall GDP= C+I+G+X-M

Measure to improve investment:

  1. Lowering of corporate tax rate to increase investment.
  2. Lowering of the repo rate by 135bpsc. To increase the access to finance.
  3. Easier of FDI norms. Most of the FDI is allowed by automatic route and others via government route.
  4. Retail investors are encouraged to invest in Mutual funds Industry, Secondary market, Primary market.
  5. Tax holidays to new startups under stratup India scheme.
  6. Export promotion scheme like Noryatbandhu scheme.

Measure to improve consumption:

  1. Lowering of Personal taxes on the form of Income tax to improve consumption.
  2. Capital infusion in the banks.
  3. More spending on welfare schemes for example 2000 RS cash transfer to farmers,
  4. More focus on creation of Jobs
  5. Bringing more people under social security net.

 

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