Govt to take a fresh view on fiscal deficit: FM

Promising all "appropriate measures" for the economy, Finance Minister Pranab Mukherjee today said the government would take a fresh look at fiscal deficit as it has crossed the previously self-imposed ceiling.

"I have priority for both growth and maintaining fiscal prudence, but at what point of time which will get more priority is to be determined depending on the situation, Mukherjee said in an interview with TV news channel CNBC-TV18.

"For the year 2008-09, we have gone beyond the figures projected in the interim Budget. What is needed right now is stimulus, but at the same time we cannot indulge in fiscal profligacy. We shall have to restore the balance," he said.

Asked if Fiscal Responsibility and Budget Management (FRBM) was a priority for him, the Finance Minister said: "What I have said in the interim Budget is my observations. I have also given a detailed explanation in my speech. That's why I had to cross the ceiling which was imposed and we shall have to take a fresh look at it."

As per the government's estimate, fiscal deficit is projected to widen to 5.5 per cent of the GDP during 2009-10.

The shortfall was "on account of the government's proactive fiscal measures initiated to counter the impact of global slowdown on the Indian economy", Mukherjee had said in his interim Budget presented in February this year.