India has taken recent decision to reduce corporate income tax saying it has a positive impact on investment supported by the International Monetary Fund (IMF). However, India should address continued fiscal consolidation and secure long term stability of fiscal conditions.
“We believe India still has limited fiscal space so they have to be careful. We support their corporate income tax cut because it has a positive impact on investment,” Changyong Rhee, Director, Asia and Pacific Department, IMF told media.
For non-bank financial sector India should address, Anne-Marie Gulde-Wolf, Deputy Director, Asia and Pacific Department, IMF said. In the context of surveillance engagement with India, she said, the IMF is increasingly emphasizing the need to better coordinate the fiscal state-level activities and fiscal activities.