NEW DELHI • India’s revenues will be “reasonably more comfortable” in the financial year starting April 1 and the government will be able to maintain its deficit target, Finance Minister Arun Jaitley said on Saturday.
“I can’t at this stage say there would be any slippage,” Jaitley told reporters after the customary post-budget meeting between the government and the central bank. “I am sure we will be able to maintain the target quite well.”
India’s annual statement of revenues and expenditures on Feb 1 widened goals for the fiscal deficit as the government fell short of its tax target and sought to boost spending on the poor and farmers before key state and national elections. The government will aim for 3.3% next year rather than its earlier 3% goal. Reserve Bank of India (RBI) governor Urjit Patel flagged inflationary risks from an expansionary budget after this month’s monetary policy review, while leaving the benchmark interest rate unchanged.
A set of data this week will give an indication of which way prices and industrial activity are moving. Industrial output growth in December is seen slowing after reaching a 25-month high. Consumer price inflation is estimated to slow from a 17-month high reached in December.
RBI’s Patel, who was with Jaitley on Saturday, said both the central bank and capital markets regulator Securities & Exchange Board of India need to be cognizant of the risks from any “bubble” in the markets. — Bloomberg