Finance Minister Pranab Mukherjee, Friday, expressed confidence that the policy road map prescribed in the Union Budget 2012-13 will steer the course of the economy and will provide a breather to the aam aadmi by containing inflation.
In his interactions with the press after presenting the Budget in the Lok Sabha earlier today, Mukherjee stressed that the fiscal consolidation is the need of the hour and the government is geared up to meet that objective. He said “We aim to get back to the path of fiscal consolidation as soon as possible.”
On high expectations from the current Budget, he said, “When I assumed Office in 2009, the global economy was going through a crisis…We need convergence of views on critical policy matters without that things are getting difficult.”
On Growth taking a beating
Referring to the existing economic ‘bottlenecks’, the Finance Minister said, “With the Eurozone economies still not recovering from the crisis situation, India is focusing on its domestic market.”
He said that global situation has made India to improve its domestic consumption, which will boost growth in the coming days.
On his attempt to make growth inclusive, he said “For inclusive growth, improvement of livelihood opportunities is very important and that’s why I made several such provisions in the Budget.”
Widening fiscal deficit
On widening of the deficit target, Mukherjee said that said that the disinvestment target of RS 30,000 crore for the next fiscal will help in arresting the trend.
He said, “To contain the deficit target, we aim to cut down expenditures on various heads and also look to mobilize tax collections.”
Cap on oil subsidy and GST?
“Oil subsidy went up to Rs 45,000 crore last year. For the next fiscal I expect the crude prices to remain at USD 115 per barrel. Though certain subsidies can’t be ruled out yet we aim to put a cap on certain subsidies” the Finance Minister said.
Regarding Goods and Service Taxes which he aims to implement by August, Pranab said “We need convergence of views with regard to GST. We need the support of the states and the Opposition for making Constitutional Amendment.”
Hike in Service Tax
In his Budget proposal, Mukherjee hiked the service tax rate from the current 10 percent to 12 percent. Defending his move, he said “The hike has been done keeping in view the GST. It is not a one year plan rather aims to align with the negative list and the upcoming GST.”