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Tuesday, July 07, 2009

Government committed to divestment of its stake in PSUs: Finance Minister

Says there is a need to accept high fiscal deficit in the short-term

The Finance Minister Pranab Mukherjee said there was a need to accept high fiscal deficit in the short-term, in his address to the India Inc after yesterday's Union budget.

Pranab Mukherjee presented the Union Budget 2009-10 in Lok Sabha today, 6 July 2009. In his budget speech, the Finance Minister said that the fiscal deficit for the year ending March 2010 may jump to 6.8% of the country's gross domestic product, as it stepped up spending on infrastructure and gave more help to farmers and the poor.

Pranab Mukherjee said that the government would cut fiscal deficit to 5.5% by FY11 and 4% by FY12 adding that he plans to take several steps in the next 8-9 months for fiscal consolidation.

Pranab Mukherjee said he was committed to the divestment of government stake in public sector units (PSUs). Setting the tone of what is his fourth career budget, the 73-year-old politician proposed estimated disinvestment proceeds of Rs 1,120 crore for 2009-10, which includes disinvestment in Rail India Technical and Economic Services (RITES), Cochin Shipyard, Telecommunications Consultants India, Manganese Core India, Rashtriya Ispat Nigam and Satluj Jal Vidyut Nigam.

Commenting on India's economic condition, he said the nation must return to growth path as soon as possible. However, he added that the global meltdown would continue in FY10.

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