Sonal Varma, MD & chief India economist at Nomura Financial Advisory & Securities, discussed Economic Survey numbers with CNBC-TV18.

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"We believe 7 percent gross domestic product (GDP) growth is an optimistic figure," Varma said on Friday.

“The first quarter growth, fiscal year, might be close to, if not lower than what we have seen in the January-March period. I do think that at the margin financial conditions in India are easing but the impact of that will show up with a lag in second half FY20. Therefore, we are most likely going to end up with growth slightly over 6.5; between 6.5 and 6.8 percent rather than 7 percent,” she added.

According to Varma, the nominal GDP growth will likely come in at 10 percent.

Talking about the fiscal deficit, she said, “3.4 percent was based on certain revenue assumptions which are not going to be met given what we achieved in FY19 and given the expected growth outlook for FY20. So just a mark to market adjustment given where the output gap is, we talk about cyclically adjusted fiscal balance itself would take 3.4 up to perhaps around 3.6.”

On the GST front, she said, “We are expecting around 13-14 percent growth in direct tax collection and around 15-16 percent on the goods and services tax side.”

With regards to Union Budget, the MD said, “The financial sector needs fixing. So the amount of recapitalization that is given to banks will be important particularly given the NBFC sector is out, the banks do need more capital.”

“On the regulatory side for the NBFCs, if they RBI is given more regulatory powers perhaps from a more medium-term perspective that would be positive,” Varma added.

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First Published:Jul 5, 2019 9:33 AM IST