Speaking at the launch of the OECD economic survey of the Indian economy today, finance secretary D Subbaro said, the country was on track to bring down fiscal deficit to 3.3 per cent this year and to three per cent in the next year and hopefully remove revenue deficit in 2008-09.

The budget for 2008-09 is already under preparation and the government''s expenditure proposals would be dovetailed to ensure that it remains within the FRBM target.

The Fiscal Responsibility and Budget Management (FRBM) Act requires the union government to reduce fiscal deficit to three per cent of the GDP and eliminate revenue deficit by 2008-09.

The government''s ability to carry out the fiscal reforms as stipulated by the FRBM Act is significantly bolstered by the high GDP growth of 9.4 per cent witnessed during 2006-07, along with the likelihood of about 8.5 per cent economic growth in the current fiscal.

The Finance Secretary opined that the government faces a challenge in maintaining its triple objectives of comparative exchange rates, a soft inflation regime, and comfortable interest rates, since the US sub-prime housing mortgage crisis is bound to have at least some impact on India.
also see : General reports on Economy