Indian economy needs govt spending even if fiscal deficit widens: Official

The government should invoke the escape clause under the FRBM Act but stay within the prescribed 0.5 per cent wiggle room allowed in an extraordinary year under the guidelines, said the official

India's current fragile economic conditions call for government action to boost spending in the coming financial year, allowing for a widening in the fiscal deficit to bolster growth, a senior official familiar with government policymaking said.

The government should invoke the escape clause under the Fiscal Responsibility and Budget Management Act but stay within the prescribed 0.5 per cent wiggle room allowed in an extraordinary year under the guidelines, said the official, who spoke on condition on anonymity.

"Going forward for next year, there is a need for both structural and counter-cyclical measures. For counter-cyclical measures the government needs fiscal