Stability of the exchange rate is very crucial for every country, irrespective of its monetary policy regime. This article presents an overview of the major events (of both international and domestic importance) that affected the rupee-dollar exchange rate after  India's independence, and attempts to determine the impact of foreign monetary policy shocks on the rupee-dollar exchange rate volatility through using GARCH modelling, multivariate regression and boosted regression trees.

This paper empirically analyses the impact of fiscal policy practices, with particular reference to the processes and analytical frameworks of gender budgeting, on ‘equally distributed equivalent’ variables of gender in the health and education sectors within the political economy framework in the countries of the Asia-Pacific region. NIPFP has been a pioneer in gender budgeting and worked in close association with Ministry of Finance to institutionalise gender budgeting in 2004. Given that the NIPFP methodology of gender budgeting at the national and sub-national levels has remained unchanged, we can use time series data to analyse the impact of gender budgeting on gender equality outcomes and the fiscal space. The inferences from this study will provide an empirical review of gender budgeting across countries in the Asia Pacific with clear policy inputs for the Ministry of Finance. 

India entered the inflation targeting monetary policy regime in 2015. Under this rule-based monetary policy regime, change in the policy rate transmits to economic activities and the current inflation rate by altering the inflation expectation of the rational economic agents. This study empirically investigates whether monetary policy can anchor inflation expectation of economic agents in India. In our analysis, the survey based measure of households' inflation expectation published by the Reserve Bank of India captures the inflation expectation of private agents. Using a co-integrated Vector Auto Regression (VAR) model, we find moderate but significant monetary policy transmission in India via the interest rate channel. However, inflation expectation seems to be unanchored by the conduct of monetary policy in the country.

The statistical invisibility of the care economy is a matter of concern. The time use survey published by the National Statistical Office in 2020 for all states is an innovative dataset to understand the economic activities under the Systems of National Accounts, 1993, which extended the production boundary to incorporate the household and societal levels of unpaid economic activities. These inferences have policy implications for gender budgeting. The paper will provide analytical backup (on the care economy) to the ongoing gender budgeting initiatives by the Ministry of Finance. 

The Indian Council for Social Science Research (ICSSR) has recently undertaken a project, sponsored by the Ministry of Home Affairs (MHA), to study critical issues in special areas in India. As part of this project, the NIPFP is assisting ICSSR to assemble documents for creating a digital library related to the study topic.  The NIPFP will design and maintain the digital library, which will include primary materials such as Constituent Assembly debates, legal instruments, policy documents, United Nations documents and contracts.

A note on the quarterly assessment of the state of the economy, covering trends in growth, inflation, trends in tax collection of Central and state governments, developments in monetary and fiscal policy. 

This study analyses changes in the revenues and expenditures of major states of India in 2020-21 vis-a-vis 2019-20 (the reference year). On revenues, we examine component-wise changes and transfers from the Central government. On expenditures, we carry out analysis at the sectoral level to understand varied response across states in protecting social sector spending vis-a-vis spending in economic sectors during the pandemic. Aggregate data provided by the CAG, Monthly Civil Accounts compiled by the office of the Principal Auditor General (PAG) in states and revised figures provided in state budgets are used to draw conclusions.

This study focuses on the intra-state distribution of public spending on health in the State of Gujarat Much of the evidence on state-level public spending has been confined to state-level aggregates and intra-state distribution has received limited attention. We examine both the horizontal (across districts) and the vertical (across levels of care) equity within the state. The study is a continuation of our ongoing work on intra-state distribution of public spending on health across Indian states.

The study attempts to unpack the phenomenon of exit from government schools, with a focus on exits at the bottom of the pyramid.  Low fee private schools (LFPS) have emerged as close substitutes for government schools, though no official data exists for this largely informal sector in schooling. The study tries to establish the size of the LFPS sector, information that is vital to any planning and resource allocations. The excess demand for private schooling needs a supply response from the State through greater investments on public schooling. We estimate the public resource needs for the expansion of government schools for Delhi. The formal policy on regulation of private schools, its various interpretations and the actual practices in the field are examined in the context of Delhi’s LFPSs. 

The study involved assessing the fiscal performance of the Government of Madhya Pradesh and its compliance with the provision of the FRBM Act during in 2017-18 and 2018-19. The study proposes to undertake a detailed assessment of state finances that includes revenue performance, spending priorities, budget management systems. The study will evaluate compliance with provisions of the FRBM Act. The study will be placed before the state legislature.

Against the backdrop of the Covid-19 pandemic, the paper explores the empirical evidence for flypaper effects in the ecological fiscal space in India. Using the panel data models, we analyse whether the impact of intergovernmental fiscal transfers or state’s own revenue determines the expenditure commitments on ecology at the state level. The econometric analysis shows that the aggregate intergovernmental fiscal transfers rather than state’s own income determines the ecological expenditure at sub-national government levels. The evidence for the efficacy of flypaper effects either stem from bureaucratic fiscal behaviour or the fiscal illusion of the economic agents about the exogeneity of ecological fiscal space. The results hold, when the models are controlled for ecological outcomes and demographic variables. However, at the disaggregated levels of intergovernmental fiscal transfers - grants and tax devolution - the evidence for flypaper effects is mixed. This result has policy implications and provides empirical evidence to Ministry to Finance about the efficacy of intergovernmental transfers on ecological expenditure at the state government level. 

The study highlights the issues and challenges faced by the Sixth State Finance Commission of Tamil Nadu in addressing its Terms of Reference in light of the Covid-19 pandemic, which adversely affected the finances of local governments, and the local body grants recommended by the Fifteenth Finance Commission. The Fifteenth Finance Commission, in its final report of the period 2021-22 to 2025-26, recommended a substantial increase in local body grants. However, to avail these grants, the state has to meet a number of entry-level conditions. Additionally, a sizable proportion of its grants were tied grants.

Health systems in low and middle-income countries are plagued by inefficiencies which lead to diminished performance by the overall health system and cause poor health outcomes. In this study we investigate the efficiency of public spending in health across the Indian states. Using state-level panel data and stochastic frontier analysis, we first estimate the technical efficiency in public spending for the different states. We identify the most and least technically efficient states. We investigate the relationship between technical efficiency and the quality of governance in the states and discuss several ways of improving efficiency and overall health system performance.

The present study focuses on the mechanism of public procurement in India. For many decades, now, the least cost selection (L1) is method has been followed for public procurement in goods, works and services. Various institutions such as the Central Vigilance Commission (CVC), NITI Aayog, FICCI etc. have suggested the need to replace this with a more suitable method which focuses both on technical as well as financial aspects of procurement. This study highlights the issues associated with the public procurement mechanism and suggests quality and cost based selection (QCBS) as an alternative mechanism which is more efficient in every aspect.The present study focuses on the mechanism of public procurement in India. For many decades, now, the least cost selection (L1) is method has been followed for public procurement in goods, works and services. Various institutions such as the Central Vigilance Commission (CVC), NITI Aayog, FICCI etc. have suggested the need to replace this with a more suitable method which focuses both on technical as well as financial aspects of procurement. This study highlights the issues associated with the public procurement mechanism and suggests quality and cost based selection (QCBS) as an alternative mechanism which is more efficient in every aspect.

The review report assessed the fiscal stance of the State Government and implementation of the provisions of the FRBM Act as per the recommendations of the Union Finance Commission. The report prepared by the Institute was placed in the state legislature and formed an important element of the established accountability structure. Review of compliance of FRBM Act of a state government provides an institutional mechanism for an independent fiscal review as recommended by the Thirteenth Finance Commission. While Finance Commissions suggested forming fiscal councils, the FRBM Act of Sikkim provides for an independent review of its FRBM Act. 

Finance Commission transfers constitute more than two-thirds of the total transfers to states. There is a need to understand the implications of the recommendations of the Fifteenth Finance Commission in terms of progressivity, fiscal stability and fiscal space at the sub-national level. Fiscal stability between the Centre and the States, sectoral grants focused on outcome, and strengthening finances and service delivery at the local level are some of the key highlights of the Fifteenth Finance Commission’s recommendations. The paper discusses the implications of the recommendations of the Commission on the fiscal space of both the Central and state governments. It also examines the issue of horizontal equalisation addressed by the Finance Commission and will review the public finance management and fiscal transparency issues at the state and Central level recommended by the Fifteenth Finance Commission.

The paper identified foundational themes such as key design features for both wholesale and retail/general purpose central bank digital currencies (CBDCs), motivations for introducing CBDCs, practical implications for public policy objectives such as financial stability, monetary policy, cross border payments etc., and key legal and regulatory considerations germane to issuing a CBDC.  More importantly, the working paper identified the pros and cons of issuing a CBDC in the context of an emerging market economy like India.

This working paper conducted a critical review of the literature concerned with using Big Data and machine learning techniques to forecast gross domestic product (GDP) growth and inflation, along with examining their applicability in the context of a developing country, taking India as a case-study. It will first address existing issues in data collection for GDP growth and inflation forecasting and issues related to Big Data. It reviewed of pre-existing forecasting techniques in the context of India and their efficacy, moving on to examining the advantages and disadvantages of machine learning techniques in the context of a developing country.

A series of market distortionary rules and regulations hinder the development of an integrated agricultural market in India. In order to ensure greater transparency and uniformity of food commodity prices across states, various reform measures have to be undertaken to develop agriculture marketing. The Central government established e-NAM in 2016 as a first step toward inducing competition in the agricultural markets. e-NAM is a pan-India electronic trading portal which integrates the existing Agricultural Produce Marketing Committee (APMC) mandis to create a unified national market for agricultural commodities.  This paper examines whether the introduction of e-NAM has improved the spatial integration of onion markets in India. Using cointegration analysis, the study investigates onion market price integration of Maharashtra, Karnataka, Rajasthan and West Bengal with the average wholesale onion price of India for the period 2010-2016 (before e-NAM ) and 2016-2019 (after e-NAM ). It provides evidence in favour of market integration for the period 2016-2019, while multiple relations are found to govern onion prices across states during 2010-2016. The evidence, in effect, suggests that the introduction of e-NAM in 2016 has improved market integration for onion in India.