Synchronisation of Fiscal and Monetary Policies in India—Some Issues

Fiscal and monetary policies are pursued independently to achieve their respective assigned goals, though broad synchronisation of the two is essential for overall consistency and efficiency. The article discusses three issues in synchronisation of the two policies, where the monetary policy actions follow, and do not precede, the fiscal policy actions. The first issue is regarding the implications of the Union Budget on the monetary policy and is considered with the Union Budget 2023–2024. The second issue is regarding the implications of tax-evaded income and recent trends therein on the credit growth in the economy. The third issue is about the consistency of the definitions of the rural areas followed in the two policies and their impact on the goal of financial inclusion in the country. JEL Codes: E52, E58, E61, E62, E63