India has done well on fiscal and economic parameters and the GDP growth can touch 8 per cent in the current fiscal with good monsoon, global headwinds notwithstanding, the Finance Ministry said today.
"This year the projections for monsoon are good. We hope that the monsoon will be good. With a good monsoon, I think India will be able to reach 8 per cent growth in the current year," said Economic Affairs Secretary Shaktikanta Das.
He was talking to reporters along with Telecom Minister Ravi Shankar Prasad after the Cabinet meeting.
Das said the fiscal deficit and the revenue deficit during 2015-16 were fully contained and targets were achieved.
"Our fiscal and micro and macro economic parameters are very positive," he said.
India's economy grew by 7.9 per cent in March quarter to consolidate its position as the fastest growing major economy, leaving behind China, with a five-year high growth rate of 7.6 per cent for 2015-16 on robust manufacturing growth. The growth was 7.2 per cent in 2014-15.
Das said overall macroeconomic numbers and fiscal parameters of the country are "very very robust".
Government was "bang on target" on the fiscal deficit front. The fiscal deficit during 2015-16 was contained at 3.9 per cent of the GDP, in line with the budget projections.
Revenue deficit showed significant improvement due to increase in capital expenditure of the government. The deficit which was 3.2 per cent of GDP in 2013-14 improved to 2.9 per cent in 2014-15 and 2.5 per cent in 2015-16.
The secretary said the Plan expenditure at Rs 4.71 lakh crore in 2015-16 was higher than Budget estimate of Rs 4.65 lakh crore. The capital expenditure has exceeded budget estimates for the first time in five years.
"We can say with confidence that with all the reform measures, policy initiatives, the direction which the Budget has given this year for the economic growth, especially for agriculture and rural sector, all this put together I think we are beginning to see the results. This is reflected in the overall GDP and in the fiscal numbers," Das said.
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The revenue and fiscal deficits, Das said, were in line with projections despite increase in capital expenditure, plan spending and devolution of share of central taxes to states.
The Secretary further said during the current financial year, private sector investment is likely to increase due to increased private consumption and rural demand.
In the Budget estimates of 2016-17, he said government has provided adequately for the requirements of the Seventh Pay Commission recommendations.
When the Committee of Secretaries looking into the recommendations finalises its report, the exact impact of the Pay Commission on the Exchequer would be known and "whatever adjustments are required that will be made", Das added.
To a question, Das said government is keeping a "close watch" on international oil prices and there is no cause of alarm at present.
"We are keeping close watch on world crude prices and it is under control so we don't see any cause of alarm as of now...Currently the oil prices are well under control," he said.
On fuel price hike, he said actually prices have been lowered also many a times and many times have gone up.
He said whatever excise collection is from fuel all that is going towards infrastructure sector and a small portion towards railways.
On a question of related to extension of tenure of RBI Governor Raghuram Rajan, Telecom Minister Prasad said: "Neither the finance minister nor me or anyone else has ever talked publicly about the issue related to Mr Rajan except to reiterate what the Prime Minister has said. Who will become the RBI Governor should not be media speculation".
