“Europe is in recession. Most emerging markets are growing very slow. It has been a difficult year for India also,” he said, almost a year after he presented the last Central budget as the finance minister.
Mukherjee took over as the President in July 2012 after which P Chidambaram was entrusted with the job to revive the economy. “Real GDP grew by 5.5% in the first half of the current fiscal year (April-September). This is significantly lower than the average 8% in the last decade,” the President said.
Chidambaram has announced his money management plan by keeping the fiscal deficit — difference between the government’s revenue and expenditure — at 5.3% of the gross domestic product (GDP) in the budget, which also found mention in Mukherjee’s speech.
The finance minister is likely to opt for “pragmatism” over “populism” in his budget with refusal to substantially hike financial kitty of the Central ministries and enforce strict austerity, in what he promised as “responsible budget” during his road shows abroad.
The President’s speech, the curtain raiser for the budget, assured introduction of two key under-preparation legislations — food security and land acquisition — in this session and a promise to increase share of manufacturing to 25% of the GDP and create 100 million within a decade. He expressed hope for better days ahead, saying that there has been moderation in core inflation.