Time not ripe to exit stimulus measures: FM
The Economic Times, December 31, 2009, Page 9
NEW DELHI: India will have to strike a balance between the needs of the economy and urgency to improve government’s finances, finance minister Pranab Mukherjee said on Wednesday. The fiscal stimulus measures announced in the last financial year, which included cuts in indirect taxes such as excise duty and service tax and extra borrowings-funded increased expenditure, had boosted the slowing economy. The measures, however, pushed up fiscal deficit to 6.2% in the previous fiscal and a projected 6.8% in the current year—a 16-year high. The finance minister pointed out that it is too early to comment on the timing of the rollback of stimulus measures. “Exiting from the stimulus packages now may not be the correct approach because if the world economy collapses, the depression would be deeper,” Mr Mukherjee said.
The Economic Times, December 31, 2009, Page 9
NEW DELHI: India will have to strike a balance between the needs of the economy and urgency to improve government’s finances, finance minister Pranab Mukherjee said on Wednesday. The fiscal stimulus measures announced in the last financial year, which included cuts in indirect taxes such as excise duty and service tax and extra borrowings-funded increased expenditure, had boosted the slowing economy. The measures, however, pushed up fiscal deficit to 6.2% in the previous fiscal and a projected 6.8% in the current year—a 16-year high. The finance minister pointed out that it is too early to comment on the timing of the rollback of stimulus measures. “Exiting from the stimulus packages now may not be the correct approach because if the world economy collapses, the depression would be deeper,” Mr Mukherjee said.
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