New Delhi, Nov 19: A growth of 8 per cent in the GDP is possible in the coming decade of the new millennium provided measures were taken for a fiscal correction as well as gearing up to the challenges of the new world order under the WTO and the second generation of economic reforms, Planning Commission member Montek Singh Ahluwalia said on Friday.He said the large fiscal deficit of the Centre and the states was a major hurdle in the present situation which prevented resources from being released for private and public investment in key crucial areas.
"The combined fiscal deficit of the Centre and the states which works out to be 8.5 per cent of the GDP should be reduced to 4.3 per cent of the GDP in the next three years time," said Singh.
At the same time, he said that plan expenditure in the critical infrastructure areas should also be reduced by 1.5 per centage points.
This would work out to a combined fiscal improvement of 5.5 percentage points for the economy as a whole, he said.
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