Prime aim is to spur demand, says FM

Stimulus will continue till global economic recovery

“Umpteen number of times I have stated that in due course we shall have to take corrective measures (phasing out of fiscal stimulus) but still I do feel that strong domestic demand is necessary... it will continue for some more time,” Finance Minister told industry captains at the India Economic Summit here.

He said return to fiscal consolidation is on the government’s agenda as indicated by the PM but till the robust recovery takes place in developed countries, the support would have to continue has a sizable portion of India’s US$ 185 billion exports to the Western markets. Referring to growth prospects, he exuded confidence the economy would grow by 7 per cent in the next fiscal, with growth rate accelerating to 9-10 per cent towards the beginning of 12th plan.

“I will be happy if I have seven per cent plus (GDP) for next year and eight percent the year after that…there after I think momentum would gather and it would be possible to have 9 to 10 per cent growth surely during the initial years of 12th Plan”, he said. On tax evasion, Mukherjee said India will start negotiations with all 77 countries for revising the double tax avoidance treaties. “I have asked Revenue Department to reopen negotiations for all 77 double tax avoidance agreements….we have entered so far so that we can have real time exchange of information on tax evasion and tax avoidance.