Sinha plans expenditure panel

Sinha plans expenditure panel
ENS ECONOMIC BUREAU

NEW DELHI, DEC 3: Finance Minister Yashwant Sinha said on Friday the government will soon consider setting up an expenditure panel to control costs. "We will do it very soon (the setting up of an expenditure commission)," Sinha told the lower house of the Parliament. The Indian government is aiming to cut costs in order to meet tight fiscal targets.

India has set a fiscal deficit target of 4.0 per cent for 1999/2000 (April-March), down from 4.5 per cent in the previous year.

The fiscal deficit at the end of August stood at Rs 48,126 crore ($11.11 billion) which was 60.2 per cent of the 1999-2000 (April-March) budget estimate of Rs 79,955 crore.

On the same date the previous year, the fiscal deficit situation as a proportion of the budget estimate for that year was 52.0 per cent. The government has set a target of a gross domestic product growth rate of between 6.0 and 6.5 per cent for 1999-2000 (April-March).

Sinha said the pace of economic reforms would also be stepped up in order to achieve a seven to eight percent economic growth rate. "This is possible only if you follow a bold economic reforms programme". On Thursday, India's lower house of Parliament voted in favour of legislation to open the country's insurance sector to foreign companies and the private sector. The two other pieces of economic legislation passed by the lower house were the Foreign Exchange Management Bill, which seeks to replace the draconian Foreign Exchange Regulation Act, 1973 and the Prevention of Money Laundering Bill.

The government will take measures to ensure an even growth rate and tackle problems of poverty and unemployment to enable the country move along a wide range of changes as part of the second generation of economic reforms, Sinha said.

Replying to a spate of queries during question hour, Sinha said the goal of economic reforms is "faster growth with employment and equity" and this is possible only by pursuing a bold strategy. The government, he said, while maintaining a growth rate of seven to eight per cent would stick to its committment of generating employment for one crore persons annually as set out in the presidential address to the joint session of parliament.

To a Sushil Kumar Shinde (Congress) demand for a white paper on economic reforms, Sinha said the government's programme of such reforms had been outlined in the address.

To a pointed question by Madhavrao Scindia (Congress) whether the government proposed to de-nationalise coal mines, Sinha said it was considering some amendments to the Coal Mines Nationalisation Act and when finalised it would be brought before the House.