By IANS,
New Delhi: Low market borrowings by the government and reduced fiscal deficit in the upcoming fiscal year will boost private investment and help reduce the public debt ratio, Finance Minister Pranab Mukherjee said Friday.
“I have brought the fiscal deficit down to 5.1 percent of GDP (gross domestic product) in 2010-11 and pegged it at 4.6 percent in 2011-12, which improves on our earlier targets,” told a Mukherjee at the International Institute of Finance here.
He said in another important step towards fiscal discipline the government had decided to reduce net market borrowings.
“I have kept net market borrowings for 2011-12 at a level which is marginally lower in absolute terms than the budget estimates of 2010-11. This is expected to give the necessary space for growth in private investments and help in consolidating the public debt ratio at a faster pace than earlier targeted,” the finance minister said.
Mukherjee said the government has adopted an strategy to attract and leverage more private investment in infrastructure sector.
“Our experience with Public Private Partnership model for infrastructure development in the country has been good. It is our intention to come up with a comprehensive policy that can be used by the centre and state governments in improving the resource flows to the sector,” he said.
On growth, finance minister said the Indian economy was back to pre-crisis growth momentum. He said Indian economy is estimated to grow 8.6 percent in the current fiscal.
“This growth in GDP comes on top of a stronger than earlier believed stimulus-led recovery of 8 percent in 2009-10, which vindicates the expansionary fiscal and monetary policy stance adopted during and after the economic slowdown in the second half of 2008,” he added.