‘To cut deficit,govt cut unproductive subsidies rather than raise taxes’

The government chose to cut unproductive subsidies among other spendings rather than increasing taxes in 2013-14 annual budget to overcome the fiscal deficit,said Raghuram G Rajan,Chief Economic Advisor in the Finance Ministry.

Written by Express News Service | Published:March 6, 2013 1:04 am

The government chose to cut unproductive subsidies among other spendings rather than increasing taxes in 2013-14 annual budget to overcome the fiscal deficit,said Raghuram G Rajan,Chief Economic Advisor in the Finance Ministry.

Addressing the convocation ceremony of the National Institute of Bank Management (NIBM) here on Tuesday,Rajan shared the rationale behind the different decisions in Union budget,presented on February 28.

“Budget is one of the steps taken to tackle the current economic situation and should be seen as a part of series of steps needed to be taken to boost the country’s economy,” he said. Rajan,former International Monetary Fund (IMF) chief economist,said combating inflation was a joint fight of the government and the Reserve Bank of India (RBI). Speaking on the occasion,RBI Governor D Subbarao told the student community that the banking sector would remain one of the most exciting fields to work in for it would be at the forefront in the developmental efforts.

He strongly ruled out the argument that public sector banks were less efficient than private banks.

NIBM director Allen Pereira said the Institute has plans to raise the overall intake up to 150 in next two years in the view of considerable number of retirements scheduled in banks during the next five years. A total 41 students,including 16 female students were conferred post graduate diploma in Banking and Finance Management during the convocation ceremony.

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