Jaitley unveils budget for growth, investment

By Manoj Kumar and Ratnajyoti Dutta

NEW DELHI (Reuters) - Finance Minister Arun Jaitley announced a budget for growth on Saturday, saying the economy was ready to "fly", that the government would boost investment and ordinary people should benefit.

Jaitley, delivering his first full-year budget since Prime Minister Narendra Modi's landslide election victory last May, said economic growth would accelerate to between 8 and 8.5 percent in the fiscal year starting in April.

"India is about to take off," Jaitley, 62, told lawmakers after rising to deliver his first full-year budget since Prime Minister Narendra Modi's landslide election victory last May.

Reaping the benefits of low global prices for oil, India's main import, Modi's nationalist government says it is in a sweet spot with spare cash to modernize roads and railways without busting fiscal deficit and inflation targets.

Jaitley said it was time for a "quantum leap" on reforms and that incremental change "is not going to take us anywhere", building on expectations that the 2015/16 budget would deliver big-bang reforms.

An overhaul of economic data has propelled India to the top of the league of fast-growing major economies, and the current account deficit is projected to fall below 1 percent next year, which would help stabilize the rupee and build up reserves.

But expectations for a further shift in expenditure from subsidies to infrastructure are sky high among investors who made India the best performing stock market in Asia after China last year on hopes Modi's government brings sweeping reforms to labour, tax and land laws.

"The settings are just right for Finance Minister Arun Jaitley to shun gradualism and go for broke," the Hindustan Times wrote in an editorial.

The market rally has continued this year on expectations that legislative reform will push ahead stalled private investment and consumer demand, and reverse a decline in corporate earnings to make Asia's third-largest economy a global growth driver.

(Additional reporting by Rajesh Kumar Singh in New Delhi and Dipika Lalwani in Mumbai; Writing by Frank Jack Daniel and Douglas Busvine)