‘Utilise unused govt land to generate jobs’
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The 13th Finance Commission headed by Vijay L Kelkar has recommended the utilisation of unused and underused government land as a revenue source for financing urban infrastructure. This inturn will generate more jobs.
Speaking about the committee's report on 'Roadmap for Fiscal Consolidation' at a press conference organised by Pune International Center and MCCIA, Kelkar gave a bird's eye view of the report and said restructuring of government balance sheet can be done by selling under performing assets including land assets. The revenue generated can be used in building urban infrastructure, carrying out reforestation and making rivers clean which in turn will generate employment for the youth. Emphasising the need for inclusive growth, Kelkar said, "Nothing is greater example of inclusive growth than giving employment"
The report points out that the core problem is curbing rising fiscal deficit as it is destabilising the economy. It has also warned that if no policy action is taken this year, financing the current account deficit which will be as high as 4.3 per cent of the GDP will be challenging and can lead to a situation which erupted in 1991 with profoundly adverse effects on growth, employment and inflation.
The committee has also proposed policy measures for both current year and medium term with the objective of reducing fiscal deficit from 6.1 per cent (scenario of no policy action) to 5.2 per cent this year and further reduction to 3.9 per cent by 2014-15. The strategy for this ensures that public investment is maintained thus encouraging greater private investment, higher growth and additional employment, said Kelkar.
To deliver fiscal deficit reduction, the committee proposed two more strategies apart from the utilisation of unused land.
The first proposal was to increase tax-to-GDP ratio through improvements in tax administration, introduction of GST and leveraging IT to reduce transaction cost to tax payers. Usage of Aadhaar card in PDS will go a long way in improving overall management system, said Kelkar. This, according to the committee, will improve tax to GDP ratio by 1 per cent.
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