India will keep both fiscal and current account deficits (CAD) within the government's targets for the year ending in March finance minister P Chidambaram said on Thursday.
"No matter what is required to be done, it (fiscal deficit) will be contained below 4.8%. As far as CAD is concerned, I started with $88 billion but revised it to $60 billion (for 2013-14)," Chidambaram said while addressing an Axis Capital event. "RBI governor yesterday (on) pegged it at $56 billion. Let me assure you governor and I are not in completion to contain it, but if I may share a secret I am going to try to do it better than $56 billion."
The CAD, which is the difference between outflow and inflow of foreign exchange, touched an all-time high of $88.2 billion, or 4.8% of the GDP, in 2012-13.
Earlier, the government had projected the CAD in the current fiscal at $70 billion, which was revised downwards to $60 billion on back of declining gold imports and recovery in exports.
He also said that the rising prices of food items is a cause of worry for government. "CPI inflation is over 10%," he said. "There are no easy answers to that, demand is obviously high.We are trying number of measures to cool inflation," he said.
While addressing industry chambers, Chidambaram asked service tax defaulters to take advantage of the amnesty scheme.
"We only want to collect the tax. By giving up interest, government is actually giving up legitimate revenue. I don't think there could be more generous offer," he said while elaborating on the Voluntary Compliance Encouragement Scheme (VCES).