Growth more important than fiscal prudence: FM

The economy averaged a growth rate of 9 per cent till 2007-08,but is estimated to slow down to about 7 per cent in 2008-09. To boost growth,Budget 2009-10 to be presented in the first week of July will focus on sectors such as textiles and leather,which have been worst hit by a global recession. Mukherjee said growth is expected to pick up by October 2009 with the outlook on monsoon becoming clear.

We have identified issues and areas of concern that need to be addressed in this Budget and will work closely with Dr Manmohan Singh in presenting the first Budget, Mukherjee said.

Even though the goal is to bring the economy back on the growth path,he said that the government cannot indulge in fiscal profligacy. Fiscal deficit for the Centre for 2008-09 is estimated to have worsened to 6 per cent of the gross domestic product,triggering concerns that heavy government borrowing will put pressure on interest rates and crowd out private investment.

Mukherjee said Budget measures are expected to focus on the aam admi. The minister outlined his priorities pointing to the Congress manifesto that promised to increase the minimum real wages to Rs 100 under the National Rural Employment Guarantee Act (NREGA). The minister expressed certainty that he and his team would be able to present the regular budget by the first week of July.

I had discussion(s) with the senior officers and colleagues and have told them that I would not like to have a second batch of Vote on Account,which is a normal practice since it helps members to take a little longer time and also ensures the Parliamentary Committees scrutiny, he said.

The finance minister said that he wants to address all the concern areas he raised in the interim Budget presented in February earlier this year. What is needed is that certain sectors,which have been very badly hit by the global financial crisis such as textile,leather,gems and jewellery,need attention, he said emphasising the fact that India has not done as badly as some of the advanced economies.

On being asked whether the government will consider another fiscal stimulus package to the economy,he said that he plans to take stock of the impact of the stimuli given in the course of the last few months on the economy. So,considering all these aspects,I will take appropriate measures, he said.

Mukherjee also emphasised the need to inject money to push growth,especially in infrastructure sectors. Massive investment in infrastructure is needed to spur growth. We need to review resources and delivery systems in the core sector, he said.