New Delhi: The centre proposes to reduce fiscal deficit to three per cent
of the gross domestic product in 2008-09, while eradicating the revenue deficit.
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.
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.
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.
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