Another year has almost gone by. The Year 2016 is fast coming to an end. With just around 10 days left for the New Year, let’s take a look at some of the interesting financial happenings that took place in our country in 2016.
The United Nations praised India, as the fastest growing economy in the World. India was growing at a rate, much faster than its much bigger rivals…Yes…India was growing faster than Russia, Taiwan and even Brazil. These countries were facing a recession. Why growth in China our biggest rival, fell to the lowest level in 25 years.
No Country in the World could match our growth….BRICS had a New King…India was the place to be. Indian economy was THE ECONOMY.
Did you take a look at the stock market in February 2016? After a couple of years of being an unstoppable force…The stock markets stopped in their tracks. The stock market crashed to levels last seen, a couple of years ago. If you were an investor in stocks, you would be licking your lips. Almost all stocks were available…at very cheap prices.
How did such a vibrant economy crash so soon? Public Sector Banks….Bad loans and NPA’s of public sector banks were a whopping INR 1.14 Lakh Crores. Yes…This is 12% of all bank loans in India. Enough to cripple any country in the World. The Indian economy had gone for a toss.
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The last day of February 2016…February 29th…. What better day to present the Union Budget 2016-2017, in the Parliament? Yes 2016 was a leap year.
The Government promoted its pet project…Affordable housing in this budget. Buying a house for the first time? Well…there were some tax benefits for you. Earning a salary less than INR 5 Lakhs? You get an INR 5,000 rebate on your income tax. This budget was viewed as PRO POOR. This Union Budget was all about farmers. This budget aimed to double farmer’s income by 2022.
Yes…this Union Budget was good for the common man and farmers.
The Government in June, accepted the 7th Pay Commission Recommendations, promising a hike in salaries and perks for Central Government employees and top executives in the Government. There was also a hike in pension for retired Government employees.
More than 47 Lakh employees in the Central Government and 52 Lakh pensioners, benefitted from this move. Imagine all this money being spent by these Government employees? The consumption industry was licking its lips. Soon cars, electronic items and other items of consumption, were going to be bought in large numbers. The economy was booming again.
The GST Bill was passed in the Rajya Sabha in the month of August. GST is a value added tax, charged on manufacture, sale and consumption of goods and services, across the country. It is a single indirect tax for the whole Nation. GST will replace all other indirect taxes which are charged by the State and Central Government. It is believed to be the biggest reform since India got her independence.
The BIG BANG
November 8th 2016, is a date you will not forget in a hurry. The Prime Minister Narenda Modi, in a speech at around 8 PM, banned 500 and 1000 rupee notes, effective midnight….which was just a few hours away. The reason…Break the back of corruption and terrorism in India, fueled by black money. Black money is usually hidden in 500 and 1000 rupee notes. This has to be the biggest financial event of 2016, not to mention the biggest financial event of the past several decades. The effects of this move are still being felt.
Honest citizens could deposit old 500 and 1000 rupee notes in banks up to any limit, till December 30th 2016. The Government then set limits on exchanging old 500 and 1000 rupee notes. You can no longer exchange these notes at banks. The old 500 and 1000 rupee notes, have been replaced with new 500 and 2000 rupee notes.
Cash withdrawal limits at banks were set at INR 24,000 a week. These rules are still on…. It’s your BIG DAY. You are getting married. Either you or parents, can withdraw INR 2,50,000 in cash, from the bank.
The Year 2016 is one to remember. Be Wise, Get Rich.
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