Summary

India's projected 7.3% growth for this fiscal stands out as an island of hope amid sinking forecasts for most major economies.

The domestic economy has benefitted from a lift in contact-based services, robust tax collections, and supportive government-led infra capex. That said, it is not entirely immune to the global headwinds or coordinated monetary tightening that is expected to play out the rest of this year.

Indian states too, have seen strong revenue collections post-second wave opening up of their economies.

Healthy devolutions by the central government and Goods and Services Tax (GST) compensation funding through back-to-back loans have further supported their fiscals.

We expect this streak to continue, albeit with a slight moderation, as GST compensation payments ended in June 2022.

That said, states' expenditures remain elevated and sticky. High committed spends (salaries, pensions and interest cost) and a continued focus on developmental expenditure lend to this.

To be sure, some states have resorted to alarmingly high off-budget borrowings, triggering cuts in borrowing limits from the Centre. On the other hand, the Centre's Rs 1 trillion interest-free capex loans to states this fiscal should help them smoothen out expenditure and catalyse investments.

Against this backdrop, CRISIL is organising a webinar titled 'Profligacy vs prudence', where our domain experts from Ratings and Research will present their views on:

• Recovery patterns across states
• The impact of the pandemic waves on state finances
• Trends in revenue collection and revenue deficit
• Outlook on capital outlays and state fiscal deficits
• Impact of indebtedness on deficit financing

This will be followed by a panel discussion by our eminent speakers and a Q&A session.

Eminent panellists: