News

Fiscal deficit stares the nation in the face
If the rail budget is an indicator, then the union budget too is unlikely to be populist. Meanwhile, as indicated in the economic survey, growing fiscal deficit will lead to inflation. The survey has already highlighted falling GDP besides, lowering industrial and agricultural production. Experts opine that the government is not making productive use of its resources. Amit Mishra said on the face of it 6.5 per cent was an abnormally high fiscal deficit. It implied that government money in excess of revenues was running around in the economy without stimulating the economy. He said the unutilised revenue should be directed at the infrastructure sector so that it could boost the economy. Manmohan Singh said in the light of the rising deficit, inflation was most likely to pick up post-budget. After the announcement of sanctions the BJP was looking towards NRIs for funds. Swaraj Paul said NRIs could not replace the international funding institutions. He said the NRI population was not so well off to repatriate huge amounts back home. He said Indians will have to face the situation and India will have to internally mop up funds to sail through the tide. Experts are talking of increasing the tax base to mop up funds. Doing away with the power subsidy is also being discussed, though it is likely to add to the troubles of the BJP-led coalition. (Business Aaj Tak)