New Delhi: Finance Minister Arun Jaitley today presented the Economic Survey in parliament. The government has said that the recommendations of 7th Pay Commission which has a bearing on the common man, has stated that it will not impact market price volatality.
According to report, increase in wages recommended by the 7th Pay Commission is unlikely to destabilise prices and will have little impact on inflation.
The Economic Survey for 2015-16 tabled in Parliament said despite high volatility in global financial markets, the Indian stock market has the higher ability to overcome adversity compared to global stock markets.
According to the survey, as the global financial system will stabilize, India will become the leading investment destination. Also, the country’s strong economic fundamentals will continue to invest in the stock market.
According to the Economic Survey, “Most of the time, the current year remained financially stable and inflation remained within the central bank target of 4-6 percent.
The 7th Pay Commission has recommended a 23.55 percent hike in salary, allowances and pension, involving an additional burden of Rs 1.02 lakh crore, to central government employees and pensioners. If the government accepts this recommendation, it would it destabilise prices and inflation expectations?
Most likely, it will not,” the survey, tabled in Parliament, said.
Citing the example of implementation of the Sixth Pay Commission, the pre-Budget document said the 7th Pay Commission award barely registered on inflation despite the lumpiness of the award, owing to the grant of arrears.
The survey noted that the wage bill (including for railways) will go up by around 52 per cent under the Seventh Pay Commission, which was 70 percent under the 6th Pay Commission.