Scope of stimulus package limited: PM

Scope of stimulus package limited: PM

Fiscal deficit & monetary policies limit Indias economic recovery

“Our response of stimulus packages was to a specific domestic situation. It is true that both scope for accelerating stimulus package and our options are limited because of factors like substantial fiscal deficit and Reserve Bank’s monetary policies. As of no, inflation is not a problem,” said Singh in a press conference at the end of his two-day visit here.
On stock markets picking up in the last few days, Singh said it was reflective of the economic recovery in the country.

At the summit, Singh strongly pitched for continuance of the global stimulus package. The summit declaration also favoured continuance of the policy and going slow on exit strategy. In his introductory statement at the press conference, the prime minister said the summit was a productive meeting and its purpose was to review what has happened and chart the way forward.

Singh said some of the important issues discussed were that there will be no premature withdrawal of the global stimulus package and the emergency financing for the fund has been successfully completed. 

Global macro balances
He also said the summit has agreed to help the World Bank and other regional development banks to find the necessary resources on a review of their capital needs in the first half of 2010. He said the summit has agreed on a new framework for discussing global macro balances and the contributions individual countries can make through their own policies with a new process of peer review or discussion in the G-20.
The prime minister said the summit also agreed that the countries should work for an early resolution of Doha round to counter protectionism.