With union budget in sight and calls for deferring fiscal consolidation becoming louder, the finance ministry today made it clear that the government is committed to promoting and strengthening inclusive and sustainable development by ensuring proper and effective utilisation of funds. In a statement the ministry said these measures would be achieved without compromising fiscal consolidation.

As a result of sound prudent policies formulated during 2015-16, the fiscal deficit at the end of November 2015 is Rs. 4.83 lakh crore or 87% of the budget estimate for this fiscal.  The fiscal deficit — the gap between expenditure and revenue — for the entire current fiscal year has been pegged at Rs 5.55 lakh crore (3.9% of GDP).

The ministry said the present fiscal situation is an improvement over the previous year’s when the fiscal deficit was then 98.9% of the Budget Estimates 2014-15. In absolute terms, there is a decrease of Rs. 41, 611 crore over November 2014 figure.

Similarly, the effective revenue deficit (revenue deficit net of grants for creation of capital assets) which is Rs.2,64,404 crore in November 2015 has shown a significant decrease of 20% at Rs 65,087 crore over November, 2014.

The finance ministry has deferred fiscal consolidation path by a year by pegging fiscal deficit at 3.9% of GDP in the current financial year instead of 3.6% envisaged earlier.
Budget 2016 on Feb 29
Meanwhile, minister of state for finance Jayant Sinha said that the government would present the budget for 2016-17 on February 29 (Monday). He said thebudget would be more than an annual document and will set the road map for the next two-three years.

“We will establish a road map for two or three years,” Sinha said in New Delhi.

“We have consistently followed a very clear set of economic policies. We have laid out economic principles very well and we are very confident that we will be able to sustain high growth over a long period of time,” he said.

It is likely that the economic survey 2015-16 could be tabled on February 26, which is a Friday.

Finance minister Arun Jaitley, in his second full-year Budget, is likely to focus on steps to accelerate economic growth that seems to have stagnated in the 7-7.5 per cent range amid a global slowdown.

Speaking on the priorities of the government, Sinha said the first and foremost responsibility was to eliminate poverty. “We are a pro-poor government but we are a pro-market government as well. If competition does not flourish, if market and companies do not flourish, how can we generate economic surplus, the tax revenues that will enable us to eliminate poverty?” he asked.

He said the government was working on increasing productivity of agriculture. On Wednesday, the government announced the National Crop Insurance Programme to protect farmers from crop damage due to natural calamity, adding, the government has launched a programme on irrigation.