Plan expenses cut was tough decision, FM

Finance Minister P Chidambaram on Thursday said that cutting plan expenditure for the current financial year was a tough decision for the government but there was no other way to save the country from serious consequences thrown up by the rising fiscal deficit.

Replying to a debate on the Budget for 2013-14 in the Lok Sabha, he, however, assured the House that there will be adequate public expenditure available to stimulate economic growth. He also expressed hope that the country will return to high growth path of 7 per cent in the next two years.

 “There was no other way. The only place we could have economised the expenditure was plan expenses. It was not a decision we were happy to take, but it was a decision we were forced to take, without which fiscal deficit could not have come down and the consequences for India would have been grave,” the minister said. He, however, said that for the current financial year, he had provided Rs 16.65 lakh crore, enough to stimulate growth. He also said that all ministries have been asked to take steps to start spending as early as April-May with a view to stimulating growth.

 The government brought down the fiscal deficit to 5.2 per cent for the current year, lower than the estimated 5.3 per cent but he said at this level too it was not sustainable.