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| Budget will be popular; let the mystery remain: Montek |
| Press Trust of India / New Delhi Jun 22, 2009, 13:09 IST |
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The first Budget to be unveiled by the new UPA government on July 6 will be "popular", Planning Commission Deputy Chairman Montek Singh Alhuwalia said.
"The word populist has negative overtones, but I am sure (the) Finance Minister will present a popular Budget. However, we should maintain the mystery of the Budget and you have to wait and see what comes out," he told PTI in an interview.
Making a case for "strong government effort" to promote growth, Ahluwalia said, "The Prime Minister has said we should get back to between 8 and 9 per cent (economic growth rate), that might take a couple of years. I think it is feasible but it requires some strong and purposeful action."
Prime Minister Manmohan Singh earlier in the month had asked the Finance Ministry "to ensure that the next union Budget adequately and appropriately reflects the priorities and programmes outlined in the President's address to the joint sitting of Parliament." Among other things, President Pratibha Patil had talked about a Food Security Act to provide 25 kg of rice or wheat per month at Rs 3 per kg to people below poverty line.
Finance Minister Pranab Mukherjee, who will be presenting the Budget for 2009-10 in the Lok Sabha in first week of July, has already indicated the government "would continue to focus on public spending in employment oriented growth sectors, increasing the purchasing power of the people."
Besides, Mukherjee had said that the focus of the government would also be on "development of rural sector — both agriculture and non-agriculture — and development of labour intensive MSME sector".
Referring to the growth prospects during the current fiscal, Ahluwalia said, "Everybody now agrees that the worst is behind us and we must focus on reviving the momentum of growth. Last year, our growth rate was about 6.7 per cent. We are hoping we can do about 7 per cent this year."
Owing mainly to the impact of global financial crisis on the country, economic growth rate fell to 6.7 per cent during 2008-09, after posting 9 per cent in three consecutive years.
Noting that fiscal deficit can take a back seat during 2009-10, he said, "What we want to do at present is advance investment as much as possible so we can do more this year and may be next year, and then as economy recovers, we can do less. The idea is to anticipate the investment that otherwise would have taken place a bit later.
"This means the fiscal deficit would be higher in the short term, but would be lower in the future because we will be only redistributing the expenditure. If we could actually increase expenditure it would be wonderful but we do have overall limits", he added.
As regards the $500 billion infrastructure sector investment target during the Eleventh Plan (2007-12), Ahluwalia said, "It has not been changed, though we know it was difficult when we set it. It has obviously become more difficult, at least temporarily."
Answering questions on disinvestment, he said, "The speech (of President Pratibha Patil) does not mention privatisation. It does mention disinvestment up to 51 per cent. It is not that important how much we do this year which has only nine months left...But I hope we can lay out a medium term programme."
With regard to auction of 3G spectrum, Ahluwalia said, "Spectrum auction is a very important initiative. I hope that will go through.
"It will trigger investment in telecom and will also raise some revenue. We do not know how much, because it is after all an auction, but it will be a very important signal of forward movement in a new area," he added.
According to some estimates, auction of spectrum can fetch over Rs 25,000 crore for the government, which is under pressure to reduce the mounting fiscal deficit.
The fiscal deficit, an indication of government borrowing, was pegged at 5.5 per cent of the Gross Domestic Product (GDP) in the interim Budget for 2009-10 and may go up further in the final budget to be unveiled in the first week of July.
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