JOIN USGovt to hold talks with stakeholders to push reforms
As drought weighs down heavily on an already-weak economic growth, the government said on Thursday, it is taking steps to give an impetus to the economy and engage in a wide range of consultations with key stakeholders to accelerate the process of reforms.
“The government has taken several initiatives, which include resumption of the process of fiscal consolidation, endeavour to restrict the expenditure on central subsidies and steps for expediting the passage of Direct Taxes Code Bill,” Finance Minister P Chidambaram said in a written reply to the Rajya Sabha.
The Indian economy grew at its lowest annual rate in almost a decade - just 5.3 per cent - in the January-March quarter this year and a negative industrial output data for the month of June indicated a further decline in the gross domestic product growth in the forthcoming quarters. Although the industrial output data is notoriously volatile, it is still taken as a barometer of economic growth in the country.
Chidambaram also said that the government was taking steps to boost supply-side measures to check inflation, which was high mainly due to soaring food prices. The Finance Minister also promised a stable and fair tax regime to regain investors’ confidence.
Besides, steps have also been taken to liberalise trade and promote sustainable growth in the economy, but drought in certain parts of the country is expected to make it difficult for the government to cut fuel subsidies responsible for a widening fiscal deficit.
In the current fiscal, the government has imposed economic measures like rationalisation of expenditure, which includes a 10 per cent mandatory cut on non-plan expenditure, a ban on creation of plan and non-plan posts, restriction on foreign travel and strict observance of discipline in fiscal transfers to states.