CII wants govt to print currency notes to keep economy afloat
Press Trust of India / New Delhi Mar 31, 2009, 17:40 IST
Industry chamber CII today asked the government to print more currency notes to bridge fiscal deficit and keep the economy afloat, which is reeling under the impact of global financial meltdown.
"If the government is going to borrow from the market to fill the fiscal deficit, then they are going to suck up all the money available in the banks and we will be crowded out," the new CII President Venu Srinivasan told reporters here.
Pitching for monetisation of the budget deficit, he said, "It means printing notes. Which means you have the risk of increasing inflation but at the same time you will keep the economy afloat."
He further said that government should also amend the Fiscal Responsibility and Budget Management Act, which imposes restrictions on public expenditure.
Raising concerns over the government's decision to raise an additional Rs 3,00,000 crore during 2009-10 to fund public expenditure, CII chief said very little money would be left for the private sector.
Adding off-budget items and state deficits, total government deficit is likely to be in excess of 10 per cent of the GDP, he said, adding revenue deficit accounts for over 70 per cent of the fiscal deficit.
Being a business think tank and occupying honourable position in economy Mr. Venu Srinivasan should not impart the idea of PRINTING CURRENY in order to solve the problem of fiscal deficit. An ordinary Graduate in Economics, I feel, this trend is very dangerous and once our cunny politician gets this idea of finding solution during the time of economic crisis, then they will influence the economical administrators to do so quickly. Then where it will end up the sound economic situation prevailing at present? God only knows!!!
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