Another stimulus possible: Pranab

Tells Parliament he will hold talks with RBI and finance ministry officials.

Two days after announcing an Interim Budget that disappointed industry for lacking stimulus measures, Finance Minister Pranab Mukherjee today announced that he would discuss the possibility of another set of fiscal and monetary measures to counter the economic slowdown with officials and the Reserve Bank of India.

Replying to a question in the Rajya Sabha, Mukherjee said, “I have just discussed with my officers, my colleagues and with some experts, and I am also going to have another round of discussion, because I do believe that fiscal corrections and monetary policy changes go side by side, so that the impact is felt.”

Although Mukherjee categorically stated that he could not give any commitment on possible measures, he told the House, “The Reserve Bank enjoys a certain autonomy. I will have consultations with the Governor of the Reserve Bank, and after doing that, I do hope that while replying to the debate on the Budget, I may be in a position — I am not making any assurance or commitment — to indicate some more detailed information.”

Mukherjee also admitted that to overcome the problem of slowdown, the government has to “ensure that more jobs are generated, and more investments in the employment-oriented sectors have to be done.”

While pointing out that the full impact of the slowdown was yet to be felt, the finance minister expressed confidence that in the course of time, it would be possible to put the economy in the right track.

He also told the Rajya Sabha that even as many Indian workers were returning home and exports were affected, there was no concern about the availability of foreign exchange reserves. “We need not press the panic button,” he told the House.

Replying to another question from Rahul Bajaj, Mukherjee said, “All measures necessary to boost the economy will be taken. The support that the Indian economy requires will be given. That is why I am laying emphasis on both the fiscal corrections and the monetary corrections. Unless these two are moved together and they move in harmony, it would be difficult to tackle the problem.”