Finance Minister Arun Jaitley today said he intends to be on track on lowering fiscal deficit even as the figure for April-October hit 96.1 per cent of budget estimates. “The FRBM (Fiscal Responsibility and Budget Management) report is under consideration. The last three years, we have an exemplary record as far as maintaining that glide path is concerned. We intend to move on that track,” Jaitley said at the HT Leadership Summit here. The government has budgeted to bring down fiscal deficit to 3.2 per cent of GDP in 2017-18, from 3.5 per cent in the previous year. According to official data released today, fiscal deficit, which is the difference between government expenditure and revenues, in April-October touched the 96.1 per cent mark of the budget estimates.The finance ministry is scheduled to review next month its fiscal deficit target for the year to March 2018.
The finance minister said the 2018-19 Budget, which will be unveiled on February 1, will focus more on infrastructure and rural sectors.He further talked about the political opinion and willingness in India not yet ready for privatisation of PSU banks. “For any reform to take place, the political acceptability of that reform has to be there. And though I would be in favour of a large number of reforms, I am pragmatic enough to realise that I don’t think political opinion in India is still ready to take that decision,” he added. The government had last month announced an unprecedented Rs 2.11-lakh crore capital infusion into PSU banks to be spread over two years. High non-performing assets have taken a toll on the profitability of public lenders.
“… it is important that you strengthen these banks even if it means putting in money. You then merge and create bigger banks, more viable banks, and probably allow them space to operate professionally, and not in a manner they operated in the post-boom period that they made this reckless lending that has brought us to this situation today,” Jaitley said. The consolidation of PSU banks started in April, with the merger of five associate banks and Bharatiya Mahila Bank with SBI. About the recapitalisation package, Jaitley said the finance ministry and the RBI are trying to figure out which are the banks that need funds and how much capital is to be infused.