India’s first full-time woman finance minister Nirmala Sitharaman will have many problems to deal with when she presents her maiden budget in Parliament on July 5, 2019. She will, however, escape the difficultly of spiralling oil prices, which has haunted most finance ministers.
Oil aside, she will have to explain a five-year low economic growth, a 45-year high unemployment, a 15-year low in investments for new projects, double-digit decline in automobile sales and falling tax collections to name a few.
However, India is not grappling with high oil prices and the outlook for oil in the coming few months is also not rising. Lower oil prices means less pressure on inflation, subsidies, current account deficit, trade deficit and finally less pressure on the Reserve Bank of India to lower interest rates.
Since a large part of India’s economy hinges on oil prices, finance ministers who present the budget during a bear run call themselves lucky. Former finance minister Arun Jaitley was one.Read More