Pranab confident of 4.6% fiscal deficit target

Finance Minister Pranab Mukherjee on Tuesday exuded confidence that the fiscal deficit target of 4.6% of the GDP for 2011-12 would be achieved.

"There are some people who have expressed some doubts over fiscal deficit target, but I can assure you they need not worry over numbers," Mukherjee said. He said the government spent Rs 50,000 crore on social projects during the current fiscal as it received revenues from sale of spectrum.

"As I may not have that bonanza next year, I will have no compulsion to spend more," he added.

In his Budget presentation for 2011-12, Mukherjee had proposed to reduce the fiscal deficit to 4.6% in the next fiscal from 5.3% of the Gross Domestic Product (GDP) this year.

Answering questions on the impact of rising crude oil prices in the international market, Mukherjee said the government is closely monitoring the global oil prices and added that it has not set any subsidy (for oil users) for any such eventuality.

"The high volatility (in oil prices) we shall have to take in account. If there is any little adjustment required in that it will have to be done in the course of time. But right now I am not in a position to make an assumption where it would reach," Mukherjee said.

Through the budget proposals, he said, "I wanted to convey a sense of continuity and stability in our approach to policy management of the economy."

The minister also told the chambers that he refrained from rolling back the excise duty to November 2008 levels to help the industry improve margins and increase investments. "I had the option to roll back the central excise duty to levels prevailing in November 2008. I have chosen not to do so and retain the rates at 10 per cent for two reasons. I would like to improve business margins translated into higher investment rates," he said.

The minister added that the five main objectives that he tried to pursue through the budget included "sustaining high growth trajectory, making development more inclusive, improving our institutions, public delivery and governance practices."