Press Esc to close
Monday 02 May 2016
News updated at 2:21 AM IST
Weather
Max: 36.6°C
Min : 24.4°C
In Bengaluru
Sunny day

Budget paves way for lowering twin deficits, says RBI

Mumbai, Feb 28 (PTI)

The Reserve Bank today welcomed the General Budget, saying it has laid the foundation for lowering fiscal and current account deficits, apart from supporting both domestic and foreign investments.

The central bank said the government's net market borrowing target of around Rs 5 lakh crore (budget estimate for the next fiscal is Rs 4.84 lakh crore) is manageable.

RBI Deputy Governor Urjit Patel at the customary post-budget press conference here said, "The Budget will go a long way in lowering the fiscal risks.

"The fiscal targets achieved in 2012-13 (5.2 per cent of GDP) and that laid down for 2013-14 (projected at 4.8 per cent) will lay the foundation for a sustainable rebalancing of government finances. This would impart confidence in the economy and support investments, both domestic and foreign."

Asked about monetary response to the Budget proposals in general and the fiscal consolidation roadmap in particular, Patel said the RBI response will be known on March 19. "As you know, the mid-term monetary policy review is next month. So, we will reflect on that and discuss it next month."

The Budget estimated fiscal deficit for the current financial year at 5.2 per cent, and at 4.8 per cent in FY14.

Patel said along with lowering of twin deficits (FD and CAD), the Budget will boost household savings along with creating a space to augment private investment.

"The Budget sets the stage for lowering the twin deficits, moderating the drafts of government on household financial savings and help create the fiscal space to augment private investment," the RBI Deputy Governor maintained.

On the concerns regarding higher subsidies, Patel, who took over the job last month, said the Budget has taken significant steps to bring down fiscal deficit and challenges arising from subsidies are being met by the Government.

"The Budget has taken significant steps forward for taking the overall fiscal deficit down and the challenge of subsidies is being met....this is a medium-term programme and we have both 2012-13 and 2013-14 numbers, which indicate the Government expenditure and borrowings are being brought down and I think, overall that's a good thing."


Go to Top

Photo Gallery
Bollywood Actors Tiger Shroff and Shraddha Kapoor during promotion of their film Baaghi...

Bollywood Actors Tiger Shroff and Shraddha Kapoor during promotion of their film Baaghi...

Narendra Modi rides in an E rickshaw during distribution of E rickshaws in Varanasi...

Narendra Modi rides in an E rickshaw during distribution of E rickshaws in Varanasi...

RCB Skipper Virat Kohli with teamate Chris Gayle during an event at a mall in Bengaluru...

RCB Skipper Virat Kohli with teamate Chris Gayle during an event at a mall in Bengaluru...

A potter makes small earthen pots on International Labor Day, on the outskirts of Ajmer...

A potter makes small earthen pots on International Labor Day, on the outskirts of Ajmer...

Aishwarya Rai and Abhishek Bachchan poses with newly wed couple Bipasha Basu and Karan Singh...

Aishwarya Rai and Abhishek Bachchan poses with newly wed couple Bipasha Basu and Karan Singh...

A Mirage appears on the Rajpath as the mercury rises in New Delhi on Sunday...

A Mirage appears on the Rajpath as the mercury rises in New Delhi on Sunday...

eam Haas driver Esteban Gutierrez of Mexico, right, and Force India driver Nico Hulkenberg...

eam Haas driver Esteban Gutierrez of Mexico, right, and Force India driver Nico Hulkenberg...

A boy admires plastic balls put up for sale at India Gate lawns in New Delhi on Sunday...

A boy admires plastic balls put up for sale at India Gate lawns in New Delhi on Sunday...

Indian Air Force Helicopter collects water from Koteshwar dam during the rescue operation...

Indian Air Force Helicopter collects water from Koteshwar dam during the rescue operation...

Children enjoy in the waters of a fountain to beat the heat at India Gate as the mercury rises...

Children enjoy in the waters of a fountain to beat the heat at India Gate as the mercury rises...