Lok Sabha Question No. 1114 (UNSTARRED), answered on 2021-07-26
Subject: Impact on Revenues
Ministry: FINANCE
Asked by: Manish Tewari

## Government of India Ministry of Finance Department of Revenue

## LOK SABHA UN-STARRED QUESTION NO. 1114

TO BE ANSWERED ON MONDAY, JULY 26, 2021 SRAVANA 4, 1943 (SAKA)

## IMPACT ON REVENUES

## 1114. SHRI MANISH TEWARI:

Will the Minister of FINANCE be pleased to state:

- (a) the impact on government revenues direct, indirect taxes as well as other sources in Q1 of the financial year 2021-22 as a consequence of the 2nd wave of COVID19;
- (b) the amount of money which the Government has borrowed/ taken from the RBI in any form in the financial year 2020-21 and the amount of money which it plans to borrow/take from the RBI in the financial year 2021-22;
- (c) the details of total government borrowing from all sources public, private, markets &  international  agencies  in  the  financial  year  2020-21  and  the  amount  of  money which the Government intends to borrow in the financial year 2021-22 in the light of the revised projections in the wake of 2nd wave of COVID-19;
- (d)  the  details  of  how  the  ballooning  the  fiscal  deficits  have  impacted  the  sovereign ratings of India brought out by the international rating agencies, yearly ratings by all such agencies from the financial year 2004-05 to 2021-2022?

## ANSWER MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI PANKAJ CHAUDHARY)

- (a)   The net direct tax collection in the 1 st  quarter of FY 2021-2022 is Rs. 2,46,519.82 crore  as  against  1,17,783.87  crore  during  the  same  period  of  previous  FY  2020-21 representing  a  growth  of  109.3%.  Similarly  net    indirect  tax  collection  in  the  1 st quarter of FY 2021-2022 is Rs. 3,11,398 crore as against 1,82,862 crore  during the same period of previous FY 2020-21 representing a growth of 70.3%.
- (b)  Government has not borrowed long-term securities from RBI in 2020-21. However, to  meet  the  short  term  cash  mismatches,  Government  avails  the  Ways  and  Means Advance (WMA)/Overdraft (OD) on a regular basis. Under this facility, WMA/OD to the extent of Rs. 3,98,990 crore was availed from RBI during 2020-21. The same was fully repaid to RBI within 2020-21 itself. RBI transferred a surplus of Rs. 57,128 crore as non-tax  revenue  receipts  to  Government  in  2020-21.  In  2021-22  also  Government does not plan to borrow any long-term securities from RBI.
- (c )   The Government's plan to meet its fiscal deficit in the FY 2020-21 (RE) and 202122 (BE) are as under:

(Rs. in crore)

| Source                      | 2020-21 (RE)   | (2021-22 (BE)   |
|-----------------------------|----------------|-----------------|
| Market Borrowing (Net)      | 1048788*       | 917708*         |
| Short term Borrowing (Net)  | 225000         | 50000           |
| External Borrowings         | 54522          | 1514            |
| Sec. Issued to NSSF (Net)   | 480574         | 391927          |
| State Provident Funds (Net) | 18000          | 20000           |
| Others Receipts (Net)       | 39129          | 54280           |
| Drawdown of Cash balance    | -17358         | 71383           |
| Total                       | 1848655        | 1506812         |

*This  excludes  borrowing  passed  on  to  States/UTs  as  loan  on  back  to  back basis in lieu of GST compensation cess shortfall.

- Further, it is stated that in FY 2020-21. Central had borrowed Rs. 1.1 lakh crore under a special window and passed on to the States as back-to-back loan to help the States to meet the resource gap due to short-release of compensation on account of inadequate balance in the Compensation Fund. Subsequent to deliberation in the 43 rd GST Council meeting, it has been decided that the Centre is borrowing Rs. 1.59 lakh crores from the market through special window in current FY and passing it on to the States/UTs as a back to back loan in appropriate tranches as was done in last year.

As per this decision Rs. 75000 crore has been released to States/UTs on 15.07.2021. (d)    India's sovereign rating by the major rating agencies from financial year 2004-05 to 2021-22 are as Annexure. It may be seen that India's rating in last few years have remained unchanged except  for  rating  by  Moody's  Investor  Services  which  changed from Baa3 to Baa2 in 2017 and again to Naa3 in 2020. Thus, changes in fiscal deficit

- do not seem to have directly impacted the sovereign rating of the country.
- *****

## Standard & Poor's Global

| Rating status   | Foreign Currency   | Foreign Currency   | Local Currency           | Local Currency   |
|-----------------|--------------------|--------------------|--------------------------|------------------|
|                 | Ratings            | Outlook            | Ratings                  | Outlook          |
| 2021            | BBB-               | Stable             | BBB-                     | Stable           |
| 2020            | BBB-               | Stable             | BBB-                     | Stable           |
| 2019            | BBB-               | Stable             | BBB-                     | Stable           |
| 2018            | BBB-               | Stable             | No ratings were currency | given for local  |
| 2017            | BBB-               | Stable             | No ratings were currency | given for local  |
| 2016            | BBB-               | Stable             | No ratings were currency | given for local  |
| 2015            | BBB-               | Stable             | No ratings were currency | given for local  |
| 2014            | BBB-               | Stable             | No ratings were currency | given for local  |
| 2013            | BBB-               | Negative           | No ratings were currency | given for local  |
| 2012            | BBB-               | Negative           | No ratings were currency | given for local  |
| 2011            | BBB-               | Stable             | No ratings were currency | given for local  |
| 2010            | BBB-               | Stable             | No ratings were currency | given for local  |
| 2009            | BBB-               | Negative           | No ratings were currency | given for local  |
| 2008            | BBB-               | Stable             | No ratings were currency | given for local  |
| 2007            | BBB-               | Stable             | No ratings were currency | given for local  |
| 2006            | BB+                | Positive           | No ratings were currency | given for local  |
| 2005            | BB+                | Positive           | No ratings were currency | given for local  |
| 2004            | BB                 | Positive           | No ratings were currency | given for local  |

Moody's Investor Services

| Rating status   | Foreign Currency   | Foreign Currency               | Local Currency                           | Local Currency                           |
|-----------------|--------------------|--------------------------------|------------------------------------------|------------------------------------------|
|                 | Ratings            | Outlook                        | Ratings                                  | Outlook                                  |
| 2021            | Baa3               | Negative                       | No ratings were given.                   | No ratings were given.                   |
| 2020            | Baa3               | Negative                       | Baa3                                     | Negative                                 |
| 2019            | Baa2               | Negative                       | Baa2                                     | Negative                                 |
| 2018            | Baa2               | Stable                         | No ratings were given for local currency | No ratings were given for local currency |
| 2017            | Baa2               | Stable (revised from positive) | Baa2                                     | Stable                                   |
| 2016            | Baa3               | Positive                       | Baa3                                     | Positive                                 |
| 2015            | Baa3               | Positive                       | Baa3                                     | Positive                                 |
| 2014            | Baa3               | Stable                         | Baa3                                     | Stable                                   |
| 2013            | Baa3               | Stable                         | Baa3                                     | Stable                                   |
| 2012            | Baa3               | Stable                         | Baa3                                     | Stable                                   |
| 2011            | Baa3               | Stable                         | Baa3                                     | Stable                                   |
| 2010            | Baa3               | Positive                       | Ba1                                      | Positive                                 |
| 2009            | Baa3               | Positive                       | Ba2                                      | Positive                                 |
| 2008            | Baa3               | Stable                         | Aa3                                      | Stable                                   |
| 2007            | Baa3               | Stable                         | Aa3                                      | Stable                                   |
| 2006            | Baa3               | Stable                         | Aa3                                      | Stable                                   |
| 2005            | Baa3               | Stable                         | No ratings given                         | No ratings given                         |
| 2004            | Baa3               | Stable                         |                                          |                                          |

FITCH Ratings

| Rating status   | Foreign Currency   | Foreign Currency   | Local Currency        | Local Currency        |
|-----------------|--------------------|--------------------|-----------------------|-----------------------|
|                 | Ratings            | Outlook            | Ratings               | Outlook               |
| 2021            | BBB-               | Negative           | BBB-                  | Negative              |
| 2020            | BBB-               | Negative           | BBB-                  | Negative              |
| 2019            | BBB-               | Stable             | BBB-                  | Stable                |
| 2018            | BBB-               | Stable             | BBB-                  | Stable                |
| 2017            | BBB-               | Stable             | BBB-                  | Stable                |
| 2016            | BBB-               | Stable             | BBB-                  | Stable                |
| 2015            | BBB-               | Stable             | BBB-                  | Stable                |
| 2014            | BBB-               | Stable             |                       |                       |
| 2013            | BBB-               | Stable             | No ratings were given | No ratings were given |
| 2012            | BBB-               | Negative           |                       |                       |
| 2011            | BBB-               | Stable             |                       |                       |
| 2010            | BBB-               | Stable             |                       |                       |
| 2009            | BBB-               | Stable             |                       |                       |
| 2008            | BBB-               | Stable             |                       |                       |
| 2007            | BBB-               | Stable             |                       |                       |
| 2006            | BBB-               | Stable             |                       |                       |
| 2005            | BB+                | Stable             |                       |                       |
| 2004            | BB+                | Stable             |                       |                       |

******