Continuing stimulus bad for economy: Finance Secretary
The government on Wednesday indicated that continuing with the economic stimulus package would not be good for the economy, even as the Indian industry warned that any move to withdraw it now could be counter-productive.business Updated: Jan 06, 2010 21:48 IST
The government on Wednesday indicated that continuing with the economic stimulus package would not be good for the economy, even as the Indian industry warned that any move to withdraw it now could be counter-productive.
"Too much of stimulus when the body is getting healthy may not be a good thing. It can be injurious to health," said Finance Secretary Ashok Chawla, referring to the textile industry's demand for more stimulus measures and sops.
“The government is unlikely to offer more stimulus for the textile sector as exports have picked up and developed countries are coming out of the slowdown,” Chawla said at an event organised by the Federation of Indian Chambers of Commerce and Industry.
But the government, he said, could consider tax incentives for garment manufacturing machinery and continue with the easy lending rate regime.
Industry representatives who had met Finance Minister Pranab Mukherjee Tuesday had lobbied for extension by six months of the stimulus provided by the government.
India's textile exports stood at $21 billion (Rs.1.05 lakh crore) in 2008-09, accounting for 12.5 percent of the country's total exports of $168.7 billion (Rs.8.435 lakh crore).
Textiles, jewellery and leather sectors saw business decline last year due to the slowdown in the developed markets that account for the bulk of India's exports.NNNN