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Plan panel also sees bright outlook for current fiscal |
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Addressing his first press conference after being reinstated as Deputy Chairman of Planning Commission, Montek Singh Ahluwalia, also expressed confidence that the economy would be able to attain a growth rate of at least 6.7 per cent during the current fiscal — the same as notched up in 2008-09 — as the business environment had turned better than what it was three months ago. The stable government, good growth potential of the economy and a strong farm economy is likely to push India’s growth rate.
However he feels that there was a need to increase plan outlays in certain sectors. “The idea behind increasing the outlays for various sectors is to increase economic activity. The Interim Budget already had significant allocation, including stimulus packages, but we will look at what more could be done for some sectors while ensuring a tolerable fiscal deficit,” he said.
On the issue of subsidy downsizing, which has been a drain on the government income, he said subsidies needed to be recast so that the benefits reach the needy.
Budgetary support: Ahluwalia stressed that there would be both budgetary and extra-budgetary resources made available for spending on infrastructure development. This in itself would help in catalysing growth across a large section of industry as well as provide employment.
On disinvestment, he said the Government could look at disinvestment in public sector undertakings as a rational way of mobilising resources. “Disinvestment is a rational proposal. There is a lot of scope to raise resources through disinvestment. There should be no objection if the Government brings down its stake to 51 per cent in PSUs”.
Fiscal deficit: Asked about the concerns on rising fiscal deficit in the wake of two stimulus measures and an interim budget on the economy and whether the Government would revisit fiscal deficit targets, Ahluwalia parried them off by pointing out that there were various other methods than direct spending, which the Government could deploy to spur growth.
To augment investment in the infrastructure sector, he said the Government could look at relaxing norms for India Infrastructure Finance Co Ltd (IIFCL), which has raised substantial amount through tax-free bonds for re-financing infrastructure projects which were approved after March 31. He said that “we are at a stage where we can invite bids for big infrastructure projects”.
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