P. Chidambaram: Indian economy stressed, hard decisions coming soon

Sep 07 2013, 22:25 IST
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P. Chidambaram speaks in Rajya Sabha in New Delhi on Saturday during ongoing monsoon session of Parliament. PTI P. Chidambaram speaks in Rajya Sabha in New Delhi on Saturday during ongoing monsoon session of Parliament. PTI
SummaryChidambaram says keeping fingers crossed over Indian rupee, but vows anti-import crackdown.

The government plans to take some 'hard decisions' to trim wasteful expenditure and curb the import of inessential items to deal with the stressed situation that is affecting the Indian economy adversely, although there will be no hasty increase in petrol and diesel prices, said FM P. Chidambaram today.

"We are going through a period of stress.... We have to take some hard decisions. Many of these measures are being taken and many measures will be announced in the next few days and weeks. Some measures to curb import of inessential items will also be announced," P. Chidambaram said while winding up a debate on the Appropriation Bill in the Rajya Sabha.

After petrol, diesel, CNG price hiked by a massive Rs 3.70

"When you are facing a gloomy situation, wasteful expenditure has to be curbed.... You call it austerity measures, you call it cut in non-plan expenditure... while we must continue to spend and continue to find money for productive investment," he said.

On concerns expressed by members of Parliament on fuel prices, Chidambaram assured them the government will not take any decision in haste to increase diesel and petrol prices.

"No decision has been taken. No decision would be taken hastily and certainly no decision will be taken without weighing the pros and cons of the larger public interest," he said.

On the Indian rupee, the finance minister said the domestic currency has shown improvement in the past few days but he is keeping his fingers crossed.

"We are fighting many unknown factors in the currency markets. Yes, the currency has appreciated in last 3-4 days. But I keep my fingers crossed," he said.

The Indian rupee, which fell to almost 69 against the US dollar last month, has started strengthening on the back of announcements by new RBI Governor Raghuram Rajan. The rupee rose 77 paise yesterday to close at 65.24, the highest level in almost two weeks.

Chidambaram said steps have been taken to increase foreign fund flows and more are being planned.

Chidambaram also spoke about the stimulus packages, days after blaming them for the current economic mess in comments that were seen as an attack on his predecessor Pranab Mukherjee, who is now the President.

"We allowed the fiscal deficit target to breach. We allowed CAD to swell. I blame nobody.

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