Government raises allowances for its employees, pensioners
Wed Jun 28 2017
Rajesh Sharma (2003 articles)

Government raises allowances for its employees, pensioners

NEW DELHI The cabinet on Wednesday approved raising allowances of government employees and pensioners, a move that is expected to boost consumer demand but strain public finances.

The one-off increase, to be effective from July 1, is estimated to cost the federal exchequer 307.4 billion rupees ($ 4.76 billion) per annum, Finance Minister Arun Jaitley told reporters after the cabinet meeting.

While higher allowances will benefit millions of public sector workers, they are expected to fuel demand-driven price pressures, posing an upside risk to the Reserve Bank of India’s inflation projections.

Rajesh Sharma

Rajesh Sharma

Rajesh Sharma is Correspondent for Stock Market of South East Asia based in Mumbai. He has been covering Asian markets for more than 5 years.

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