Search the Internet          Tips  Sites: Finance, Investment

Need to slash fiscal deficit for 9% growth: Sinha

Union Finance Minister Yashwant Sinha said on Monday that mounting fiscal deficit of the Centre and the states had to be reined in to move to a higher 9 per cent growth path.

"This is one problem that has to be resolved if we want to attain higher growth rate," Sinha said at a function of Indian Institute of Public Administration.

Sinha's statement comes in the wake of the Centre's Rs 284.82-billion deficit accounting for 1.15 per cent GDP in the first two months as against the target of 4.7 per cent for the entire year.

The Centre's deficit slipped to 5.21 per cent last fiscal as against the targeted 5.1 per cent.

GDP growth was lower at 5.2 per cent as against the targeted 6.0 per cent last fiscal.

The growth was lower last fiscal due to higher international oil prices and lower food production, Sinha said pointing to global trends.

Sinha, however, exuded confidence saying: "The second generation reforms and the Tenth Plan are meant to attain a higher growth rate, social justice and reduce poverty. I am confident, if we put in place the policies announced in the budget, higher growth rate could be achieved."

This year's budget, Sinha said, included many of the measures which is part of the second generation reforms, which requires legislative changes and hence more time to implement.

Reform is a continuous process and has to be carried out in the outset of the challenges emerging from globalisation.

Rebutting the Opposition's claim that the government was sacrificing sovereignty to WTO, IMF and World Bank, Sinha said: "National sovereignty is not a flower that will wilt due to some policy changes."

Tell us what you think of this report