The government would soon take a decision on various suggestions of NK Singh committee on rewriting the fiscal responsibility framework, a senior finance ministry official said. “There are many important recommendations (of N K Singh panel). Some of them would be part of the budget…very soon government will take a decision on that,” the official said.
The government will follow calibrated measures to bring down fiscal deficit which will also impact the debt level that is still high. In Union Budget 2017-18, the fiscal deficit has been pegged at 3.2 per cent, lower than 3.5 per cent in the last financial year.
The Fiscal Responsibility and Budget Management (FRBM) committee, headed by former revenue secretary NK Singh, recommended keeping budgetary deficit at 3 per cent of the GDP in three years till March 2020. It also suggested progressively reducing deficit to 2.5 per cent by 2022-23 and pruning India’s overall indebtedness as a proportion of the GDP.
The panel suggested setting up of a new fiscal council as an autonomous body under finance ministry. The official further said India is the fastest growing economy in the world despite some blips last year. “Those things have played out…and institutions expect India to resume plus seven per cent growth, the highest in the world,” the official, who did not wish to be identified, said. There is some stress in the financial sector, especially the banking system, and that is an area where a lot of action is required, he added.
Meanwhile, speaking to reporters on Thursday, Economic Affairs Secretary Subhash Chandra Garg said the micro and macroeconomic indicators of the Indian economy are quite strong and the government would further strengthen them. Raising economic growth, development and distribution of benefits to poor sections of the society will be his main priorities, said Garg, who took charge on Wednesday.
Garg will meet officers of department of economic affairs on Saturday to take stock of FRBM panel suggestions, electoral bonds scheme and investment proposals.