Need new policies to fend off global threats, says Pranab Mukherjee
Finance Minister Pranab Mukherjee has said the government will have to take policy measures to shield the Indian economy from global headwinds.
"On account of the global impact, the Indian economy was facing areas of concern and to address them appropriate policy instruments were required," said Pranab Mukherjee during a pre-budget meeting with members of Parliamentary consultative committee.
The government is expected to unveil measures to spur investment, particularly in infrastructure and agriculture.
GDP growth in India is expected to fall to 7% during 2011-12, compared to 8.5% in the previous fiscal on account of domestic factors such as high inflation and policy uncertainty and the global economic slowdown.
Mukherjee said the global crisis of 2008 and the ongoing Eurozone crisis had to led to problems of high inflation and deceleration in growth.
"The volatility of international prices, particularly fuel, posed serious challenges on the inflation front," he said, according to a finance ministry statement.
The consultative committee suggested that greater focus is required on infrastructure and the efficiency of social schemes should be improved.
"There should be a greater focus on infrastructure sector, education, power, warehousing facilities and agro-based industries", said the consultative committee, which included several members of parliament and senior officials of the ministry of finance.
The panel emphasized the need to rationalize centrally sponsored schemes in view of a widening fiscal deficit.
The need to priorities financial inclusion and improving the efficiency of MGNREGA was also discussed.
"Centre should not merely depend on utilization certificates given by the States for Centrally Sponsored Schemes and proper coordination and monitoring between Centre and States is necessary for their successful implementation...," the committee said.
SOURCE: economictimes.indiatimes.com
CAclubindia
