Centre mulling 10% cut in non-Plan spend, says FM

Economic stimuli would in be place till visible global recovery

Pranab’s Prescriptions: Union Finance Minister Pranab Mukherjee briefing reporters in Bangalore on Saturday. DH Photo

Briefing reporters here, Mukherjee said this would result in a humongous savings given the current economic scenario in the country. As per the budget estimates provide for a total expenditure of Rs 10,20,838 crore consisting of Rs 6,95,689 crore under non-plan and Rs 3,25,149 crore under plan registering an increase of 37 per cent in non-plan expenditure and 34 per cent in plan expenditure over budget estimates of 2008-09. In this regard, he said, the present slew of austere steps taken would only be a drop in the ocean.

Tab on stock market
Stating that the Centre was keeping a close tab on the stock markets, the finance minister said, the current Sensex movements in the markets was steady  and not volatile to warrant any intervention. “I do not like to disturb the market now. I am notcing the Sensex is moving up,” he added. Further, Mukherjee said, the stimulus packages introduced to insulate the economy as also provide a prop to the sectors of the industry, to cushion them from the impact of the global financial crisis, would continue till economies of Europe and US recover. “At the recently held G-20 countries’ finance ministers’ meet in London, we came to the conclusion that we should not reverse the stimulant package, which we have injected in the aftermath of international financial crisis, till the full recovery in Europe and North America is distinctly visible,” he observed.
The finance minsters of the G-20 met in London Sep 4-5 to prepare a brief for the third group summit at Pittsburgh, the US, Sep 24-25, where Prime Minister Manmohan Singh is also participating.

Stating that the he was watching the situation carefully, Mukherjee said “I do feel there will be a recovery in the economy in the third and fourth quarter of this fiscal (2009-10). We shall have to wait for some more time, as the GDP (gross domestic product) growth in the first quarter was 6.1 percent. We will know the growth in the second quarter next month.”.

Mukherjee hoped he would have a clear picture of the country’s economic health at the time of formulating the budget proposals for next fiscal. “It will be possible for me to have an overall look into the whole aspects,” he noted.

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