Sinha hints at `strong steps' in Budget

Sinha hints at `strong steps' in Budget
AGENCIES

DAVOS, FEB 1: Finance Minister Yashwant Sinha today hinted at formulation of "some very strong steps" in the forthcoming general budget to tackle the "major problem area" of revenue deficit in a bid to bring it under control. Sinha also said defence will continue to get the "highest priority" in the budget especially in the light of Kargil experience last year and this sector can expect a "higher outlay". He said the government was left only with "hard options" to address the "difficult" fiscal situation.

"The fiscal situation has become difficult not only this year. It has been difficult for almost two decades and nothing much has been done to bring fiscal situation under control either at the central level or states", Sinha said shortly before he left for home after participating in the 30th annual meeting of the prestigious World Economic Forum here. "It is quite clear that we cannot live with that kind of fiscal deficit year after year," Sinha said adding, "therefore we have to take some very strongsteps to bring the fiscal deficit under control, especially the revenue deficit".

Sinha said revenue deficit was in fact the "only major problem" at the moment. "the Indian economy was doing well and there was an increase in exports," he said, adding all other indices suggested that government was "in control" of the situation. Sinha did not speculate on the fiscal deficit for 1999-2000 that would be outlined in the Budget. The fiscal deficit target was pegged at 4.5 per cent of the GDP in the last Budget. Sinha said the government was keeping a strict control over expenditure.