Union finance minister Pranab Mukherjee on Wednesday said it would be tough to achieve the fiscal deficit target for 2011-12, but the government was not thinking of revising this as yet.
The target given in the Budget was a limit of 4.6 per cent of gross domestic product.
“I’m not indulging in changing the number right now. I would like to watch for a month or so, as I still have five-six months,” the finance minister said. In October, the government increased its market borrowing plan by Rs 52,800 crore for the second half of the current financial year. The finance ministry had said a higher borrowing target would not mean an overshoot in the fiscal deficit.
Mukherjee also said high prices were hurting the Indian economy but inflation was likely to start easing from December. Data released on Monday showed inflation was little changed in October, staying above nine per cent for the 11th consecutive month.
On the impact of the euro zone crisis, the finance minister said our exports had seen a drop, despite diversified products and destinations.
On the euro zone crisis, Mukherjee said European nations should take the onus of a bailout on themseleves. “There are some solvency issues and that should be done by the europeans themselves," he said. Whatever the International Montary Fund would contemplate, India would like to be associate with this, he added.
Mukherjee also said the government was committed at keeping banks' tier-I capital above eight per cent.
In the Union Budget 2011-12 (April-March), the government had said it would infuse Rs 20,157 crore into public sector banks to maintain their Tier-I capital this financial year.