<p>Domestic rating agency Icra Ratings on Monday said it expects the country's real gross domestic product (GDP) to grow by 10.1 per cent in FY2022.</p>

<p>It, however, said the value of GDP in the next financial year will only mildly surpass the level that had been recorded in FY2020.</p>

<p>"After a 7.8 per cent pandemic-driven shrinkage in the ongoing fiscal (FY2021), India's real GDP is projected to record a growth of 10.1 per cent in FY2022. The seemingly-sharp expansion will be led by the continued normalisation in economic activities as the roll-out of COVID-19 vaccines gathers traction, as well as the low base," the agency principal economist Aditi Nayar said in a report.</p>

<p>The agency's principal economist expects a multi-speed recovery in FY2022, with the contact-intensive sectors, discretionary consumption and investment by the private sector trailing the rest of the economy, in the arduous march back to attaining, and sustaining, pre-COVID levels.</p>

<p>"On a sobering note, we project the aggregate value of the Indian GDP in real terms in FY2022, to be only mildly higher than the level recorded in FY2020," Nayar added.</p>

<p>The agency expects the headline CPI inflation to decline to 4.6 per cent in FY2022 from 6.4 per cent in FY2021, while exceeding the mid-point of the Monetary Policy Committee's (MPC's) medium target of 4 per cent, for the third consecutive year.</p>

<p>A favourable base would moderate the retail food inflation to an average of 4.7 per cent in FY2022 from 8 per cent in FY2021, despite the pressures from edible oils, and protein items such as pulses, it said.</p>

<p>With the CPI inflation expected to remain above the MPC's 4 per cent target during FY2022, the agency expects an extended pause for the repo rate.</p>

<p>It expects the "stance of monetary policy to be changed to neutral from accommodative in the August 2021 policy review or later, only after there is greater certainty on the durability of the awaited economic revival." The report said RBI may initiate steps, in a calibrated manner, to reduce the magnitude of the systemic liquidity surplus.</p>

<p>Nayar said the government security yields will take a cue from the size of the borrowing programme of the central and the state governments for FY2022, as well as the outlook for inflation. The agency expects the twin deficits to display a divergent trend in FY2022.</p>

<p>"As the revenue shock ebbs, we project India's general government (centre + states) fiscal deficit to moderate to 8.5 per cent of GDP in FY2022 from the 12-12.5 per cent of the GDP expected in the current year," Nayar said.</p>

<p>However, with imports expected to revive in tune with the anticipated recovery in domestic demand, the current account balance is forecast to slip back into a modest deficit of USD 15-20 billion (or 0.6 per cent of GDP) in FY2022 from a surplus of USD 35-40 billion in FY2021, she said.</p>


Domestic rating agency Icra Ratings on Monday said it expects the country's real gross domestic product (GDP) to grow by 10.1 per cent in FY2022. It, however, said the value of GDP in the next financial year will only mildly surpass the level that had been recorded in FY2020.

Domestic rating agency Icra Ratings on Monday said it expects the country's real gross domestic product (GDP) to grow by 10.1 per cent in FY2022. It, however, said the value of GDP in the next financial year will only mildly surpass the level that had been recorded in FY2020. "After a 7.8 per cent pandemic-driven shrinkage in the ongoing fiscal (FY2021), India's real GDP is projected to record a growth of 10.1 per cent in FY2022. The seemingly-sharp expansion will be led by the continued normalisation in economic activities as the roll-out of COVID-19 vaccines gathers traction, as well as the low base," the agency principal economist Aditi Nayar said in a report. The agency's principal economist expects a multi-speed recovery in FY2022, with the contact-intensive sectors, discretionary consumption and investment by the private sector trailing the rest of the economy, in the arduous march back to attaining, and sustaining, pre-COVID levels. "On a sobering note, we project the aggregate value of the Indian GDP in real terms in FY2022, to be only mildly higher than the level recorded in FY2020," Nayar added. The agency expects the headline CPI inflation to decline to 4.6 per cent in FY2022 from 6.4 per cent in FY2021, while exceeding the mid-point of the Monetary Policy Committee's (MPC's) medium target of 4 per cent, for the third consecutive year. A favourable base would moderate the retail food inflation to an average of 4.7 per cent in FY2022 from 8 per cent in FY2021, despite the pressures from edible oils, and protein items such as pulses, it said. With the CPI inflation expected to remain above the MPC's 4 per cent target during FY2022, the agency expects an extended pause for the repo rate. It expects the "stance of monetary policy to be changed to neutral from accommodative in the August 2021 policy review or later, only after there is greater certainty on the durability of the awaited economic revival." The report said RBI may initiate steps, in a calibrated manner, to reduce the magnitude of the systemic liquidity surplus. Nayar said the government security yields will take a cue from the size of the borrowing programme of the central and the state governments for FY2022, as well as the outlook for inflation. The agency expects the twin deficits to display a divergent trend in FY2022. "As the revenue shock ebbs, we project India's general government (centre + states) fiscal deficit to moderate to 8.5 per cent of GDP in FY2022 from the 12-12.5 per cent of the GDP expected in the current year," Nayar said. However, with imports expected to revive in tune with the anticipated recovery in domestic demand, the current account balance is forecast to slip back into a modest deficit of USD 15-20 billion (or 0.6 per cent of GDP) in FY2022 from a surplus of USD 35-40 billion in FY2021, she said.

India's real GDP to expand by 10.1 per cent in FY2022: ICRA 

<p>Recently, the Supreme Court (SC) was called upon to decide the Constitutional validity of Section 139AA of the Income Tax Act, which provides that every Pan Card holder or Income Tax Assessee has to compulsorily enroll for an Aadhaar Card.&nbsp;</p>

<p>A challenge was laid to this Provision, inter alia on the ground that though the &lsquo;Aadhaar Act&rsquo; prescribes that enrolment to Aadhaar is voluntary as per Section 139AA which, however, adds an element of compulsion.&nbsp;<br />
It may be recalled that by way of interim Orders, the Supreme Court made it clear that Aadhaar could only be used for certain schemes like MGNREGS, Pensions, Jan Dhan Yojana, Provident Fund, public distribution of food grains and cooking fuels.&nbsp;</p>

<p>&nbsp;</p>

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<h5>There is a valid risk of leakage and hacking of the database</h5>
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<p>The Petitioners, thus, argued that Section 139AA was in violation of the Orders which provided that Aadhaar could not be used for any other purpose.&nbsp;Besides, it was also emphasised that there is a valid risk of leakage and hacking of the database.&nbsp;The Court, after a careful consideration of the submissions from both sides, held that the Parliament is empowered to make a particular Provision directory in one statute (Aadhaar Act) and compulsory in the other (Income Tax Act). That by itself cannot be a ground to question the competence of the Legislature.&nbsp;</p>

<p>The Court recognised the various advantages of Aadhaar such as (i) benefits of welfare schemes reaching people for whom they were meant; (ii) tackling corruption and black money; (iii) helping enforcement agencies to combat terrorism and other crimes; (iv) weeding out duplicate PANs.On the issue of PAN, the Court observed it has an impact on day to day activities and commercial transactions. Therefore, till the larger aspects of Right to Privacy and human dignity, etc. are not decided by the Constitution Bench, it is necessary to impose a partial stay to prevent PANs being made invalid retrospectively.&nbsp;</p>

<p>&nbsp;</p>

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<h5>Implementation of Aadhaar, in its present form raises a number of concerns, which have either been dealt with quite casually by the Government or have not been addressed at all</h5>
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<p>It must be respectfully stated that there are a few aspects which the Court does not seem to have fully considered. More importantly, the manner in which Aadhaar is sought to be implemented by the Government is not entirely appropriate either.&nbsp;There is no doubt that the initiative of the present Government is praiseworthy. Its advantages are undeniable. However, despite these apparent advantages, the implementation of Aadhaar, in its present form raises a number of concerns, which have either been dealt with quite casually by the Government or have not been addressed at all.&nbsp;</p>

<p>A valid concern is that of possible data leak collected from the individuals. Although the Court in its Judgment, recognises data leak as a real possibility, it only states that this concern needs to be addressed by the Government by ensuring that a proper scheme in this regard is devised at the earliest.&nbsp;Despite this direction, which itself is more of an observation, there is little chance that the Government may do much about it, given the manner in which it has approached the security concern so far. Till date, neither in the Parliament nor in the Court has the Government been able to provide a clear plan on how it would go ahead in tackling this critical issue.&nbsp;It is important to mention that the present Bench of two Judges (Sikri and Bhushan J.J.) was only called upon to look into the Constitutional validity of Section 139AA. The larger issue of whether Aadhaar impinges on the &lsquo;Right to Privacy&rsquo; and &lsquo;Human Dignity&rsquo; is pending before the larger Constitution Bench.&nbsp;</p>

<p>The two Judge Bench had made it clear that it was not going to touch upon the Privacy issue. Had the Petitioners insisted on arguing the right to privacy, the matter would have been &lsquo;tagged&rsquo; with the pending challenge before the Constitution Bench.&nbsp;Instead, the Petitioners decided that they would not be raising the &lsquo;Right to Privacy&rsquo; and would be questioning the validity of Section 139AA, primarily on Articles 14 and 19 of the Constitution.&nbsp;<br />
In my humble view, whether it is a challenge to the Aadhaar Act itself before the Constitution Bench, or to Section 139AA of the Income Tax Act before the Division Bench, neither of these cases can be decided effectively without touching upon concepts of &lsquo;Right to Privacy&rsquo;, &lsquo;Bodily Integrity&rsquo; and &lsquo;Informational Self-Determination&rsquo;. By giving up arguments of Privacy etc., the Petitioners have unfortunately fought with one hand tied behind their backs.<br />
It appears that the Petitioners chose to go ahead before the Division Bench by giving up the &lsquo;Privacy&rsquo; argument since the Constitution Bench had not been able to take up the matter for final determination despite various urgent mentionings. In addition, the deadline of &nbsp;July 1, 2017, mentioned in Section 139AA for linking PAN cards and Income Tax Returns was fast approaching.&nbsp;</p>

<p><br />
The larger challenge before the Constitution Bench has itself been pending for a very long time now. In the meantime, the Government is going ahead rapidly with the implementation, thereby leading to a possible situation where the entire challenge may become only academic, if not redundant.&nbsp;The Government, in going ahead (however noble or much needed the step may be), without addressing or properly analysing the risks it is clearly putting the cart before the Horse. It cannot be denied that there are certain pressing apprehensions that require immediate attention.</p>

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<h5>UIDAI has lodged a criminal complaint, saying that certain firms have been storing biometrics and using them illegally</h5>
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<p>Such database may create opportunities for people who are vulnerable or perceived as a threat. For instance, a person may be implicated falsely by the Police in serious cases, such as terrorism or murder by simply taking his fingerprints from the database and planting them at the scene of the crime. History has shown us time and again, the propensity of investigative agencies to incriminate people falsely. There is also a huge concern about private or foreign entities being contracted to collect and store data. If the registration machines do not belong to the State, it is extremely difficult for the State to guarantee that such sensitive information will not be leaked or misused.&nbsp;<br />
It was recently reported that the UIDAI has lodged a criminal complaint, saying that certain firms have been storing biometrics and using them illegally. With the growing footprint of Aadhaar and the same being made mandatory, such crimes are only likely to rise in the future. Unfortunately, we are not ready to handle mass online attacks, in a space where criminals are getting more sophisticated every day. On the other hand, our Cyber Crime Cells are lagging abysmally behind, with little or no training being imparted to these so-called specialised Police Officers.&nbsp;</p>

<p>One major criticism of the Aadhaar Act is that it came to be passed as a Money Bill, cleverly escaping passage through the Rajya Sabha. It is difficult to understand how &lsquo;Aadhaar&rsquo; was categorised as a Money Bill. In fact, at the time when the Bill was passed on 11.03.2016 by the Lok Sabha, the attendance was merely 73 persons out of a total strength of 543 members. When the Rajya Sabha returned the Bill with suggestions/amendments, they were taken up by the Lok Sabha on 16.03.2016 and none of the amendments/suggestions was accepted. Running down the Parliamentary Institution and Procedures sets a very dangerous trend, which must be avoided at all costs.&nbsp;<br />
The possibility per se of misuse does not render a Legislation invalid. However, with the nature of this project, the risk is too high to not be addressed in a proper manner. The least that such an ambitious project required was a proper and informed debate in both houses of the Parliament as also, inviting suggestions from all stakeholders, including the public at large.</p>

<p>It is also difficult to understand the extreme urgency to implement Aadhaar when its Constitutionality is yet to be determined by the Court.&nbsp;If there are genuine apprehensions in the minds of the citizens in parting with sensitive information and linking it with various aspects of their daily life, it is the bounden duty of the State to allay such fears.&nbsp;Despite all odds, however, the citizens, ever hopeful and optimistic, place their faith in the government&rsquo;s intention to address such grave issues and not wait for it to turn into a tool for abuse.&nbsp;</p>

<p>As it has been said, &ldquo;our eyes were on the other-world, the stars, the Gods. We didn&rsquo;t keep watch on the world around us. And when we eventually lowered our heads and studied the waters closer to home, it was too late&rdquo;.</p>


Recently, the Supreme Court (SC) was called upon to decide the Constitutional validity of Section 139AA of the Income Tax Act, which provides that every Pan Card holder or Income Tax Assessee has to compulsorily enroll for an Aadhaar Card. A challenge was laid to this Provision, inter alia on the ground that though the ‘Aadhaar Act’ prescribes that enrolment to Aadhaar is voluntary as per Section 139AA which, however, adds an element of compulsion. It may be recalled that by way of interim Orders, the Supreme Court made it clear that Aadhaar could only be used for certain schemes like MGNREGS, Pensions, Jan Dhan Yojana, Provident Fund, public distribution of food grains and cooking fuels. There is a valid risk of leakage and hacking of the database × The Petitioners, thus, argued that Section 139AA was in violation of the Orders which provided that Aadhaar could not be used for any other purpose. Besides, it was also emphasised that there is a valid risk of leakage and hacking of the database. The Court, after a careful consideration of the submissions from both sides, held that the Parliament is empowered to make a particular Provision directory in one statute (Aadhaar Act) and compulsory in the other (Income Tax Act). That by itself cannot be a ground to question the competence of the Legislature. The Court recognised the various advantages of Aadhaar such as (i) benefits of welfare schemes reaching people for whom they were meant; (ii) tackling corruption and black money; (iii) helping enforcement agencies to combat terrorism and other crimes; (iv) weeding out duplicate PANs.On the issue of PAN, the Court observed it has an impact on day to day activities and commercial transactions. Therefore, till the larger aspects of Right to Privacy and human dignity, etc. are not decided by the Constitution Bench, it is necessary to impose a partial stay to prevent PANs being made invalid retrospectively. Implementation of Aadhaar, in its present form raises a number of concerns, which have either been dealt with quite casually by the Government or have not been addressed at all × It must be respectfully stated that there are a few aspects which the Court does not seem to have fully considered. More importantly, the manner in which Aadhaar is sought to be implemented by the Government is not entirely appropriate either. There is no doubt that the initiative of the present Government is praiseworthy. Its advantages are undeniable. However, despite these apparent advantages, the implementation of Aadhaar, in its present form raises a number of concerns, which have either been dealt with quite casually by the Government or have not been addressed at all. A valid concern is that of possible data leak collected from the individuals. Although the Court in its Judgment, recognises data leak as a real possibility, it only states that this concern needs to be addressed by the Government by ensuring that a proper scheme in this regard is devised at the earliest. Despite this direction, which itself is more of an observation, there is little chance that the Government may do much about it, given the manner in which it has approached the security concern so far. Till date, neither in the Parliament nor in the Court has the Government been able to provide a clear plan on how it would go ahead in tackling this critical issue. It is important to mention that the present Bench of two Judges (Sikri and Bhushan J.J.) was only called upon to look into the Constitutional validity of Section 139AA. The larger issue of whether Aadhaar impinges on the ‘Right to Privacy’ and ‘Human Dignity’ is pending before the larger Constitution Bench. The two Judge Bench had made it clear that it was not going to touch upon the Privacy issue. Had the Petitioners insisted on arguing the right to privacy, the matter would have been ‘tagged’ with the pending challenge before the Constitution Bench. Instead, the Petitioners decided that they would not be raising the ‘Right to Privacy’ and would be questioning the validity of Section 139AA, primarily on Articles 14 and 19 of the Constitution. In my humble view, whether it is a challenge to the Aadhaar Act itself before the Constitution Bench, or to Section 139AA of the Income Tax Act before the Division Bench, neither of these cases can be decided effectively without touching upon concepts of ‘Right to Privacy’, ‘Bodily Integrity’ and ‘Informational Self-Determination’. By giving up arguments of Privacy etc., the Petitioners have unfortunately fought with one hand tied behind their backs. It appears that the Petitioners chose to go ahead before the Division Bench by giving up the ‘Privacy’ argument since the Constitution Bench had not been able to take up the matter for final determination despite various urgent mentionings. In addition, the deadline of July 1, 2017, mentioned in Section 139AA for linking PAN cards and Income Tax Returns was fast approaching. The larger challenge before the Constitution Bench has itself been pending for a very long time now. In the meantime, the Government is going ahead rapidly with the implementation, thereby leading to a possible situation where the entire challenge may become only academic, if not redundant. The Government, in going ahead (however noble or much needed the step may be), without addressing or properly analysing the risks it is clearly putting the cart before the Horse. It cannot be denied that there are certain pressing apprehensions that require immediate attention. UIDAI has lodged a criminal complaint, saying that certain firms have been storing biometrics and using them illegally × Such database may create opportunities for people who are vulnerable or perceived as a threat. For instance, a person may be implicated falsely by the Police in serious cases, such as terrorism or murder by simply taking his fingerprints from the database and planting them at the scene of the crime. History has shown us time and again, the propensity of investigative agencies to incriminate people falsely. There is also a huge concern about private or foreign entities being contracted to collect and store data. If the registration machines do not belong to the State, it is extremely difficult for the State to guarantee that such sensitive information will not be leaked or misused. It was recently reported that the UIDAI has lodged a criminal complaint, saying that certain firms have been storing biometrics and using them illegally. With the growing footprint of Aadhaar and the same being made mandatory, such crimes are only likely to rise in the future. Unfortunately, we are not ready to handle mass online attacks, in a space where criminals are getting more sophisticated every day. On the other hand, our Cyber Crime Cells are lagging abysmally behind, with little or no training being imparted to these so-called specialised Police Officers. One major criticism of the Aadhaar Act is that it came to be passed as a Money Bill, cleverly escaping passage through the Rajya Sabha. It is difficult to understand how ‘Aadhaar’ was categorised as a Money Bill. In fact, at the time when the Bill was passed on 11.03.2016 by the Lok Sabha, the attendance was merely 73 persons out of a total strength of 543 members. When the Rajya Sabha returned the Bill with suggestions/amendments, they were taken up by the Lok Sabha on 16.03.2016 and none of the amendments/suggestions was accepted. Running down the Parliamentary Institution and Procedures sets a very dangerous trend, which must be avoided at all costs. The possibility per se of misuse does not render a Legislation invalid. However, with the nature of this project, the risk is too high to not be addressed in a proper manner. The least that such an ambitious project required was a proper and informed debate in both houses of the Parliament as also, inviting suggestions from all stakeholders, including the public at large. It is also difficult to understand the extreme urgency to implement Aadhaar when its Constitutionality is yet to be determined by the Court. If there are genuine apprehensions in the minds of the citizens in parting with sensitive information and linking it with various aspects of their daily life, it is the bounden duty of the State to allay such fears. Despite all odds, however, the citizens, ever hopeful and optimistic, place their faith in the government’s intention to address such grave issues and not wait for it to turn into a tool for abuse. As it has been said, “our eyes were on the other-world, the stars, the Gods. We didn’t keep watch on the world around us. And when we eventually lowered our heads and studied the waters closer to home, it was too late”.

Aadhaar: Putting the Cart before the Horse

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India's real GDP to expand by 10.1 per cent in FY2022: ICRA

Aadhaar: Putting the Cart before the Horse