"There is a visible lack of sync between the fiscal and monetary policy being followed by the government and the RBI ... The Committee strongly feel that monetary policy alone cannot bring down inflation or spur growth in the absence of commensurate fiscal measures," said a Parliamentary panel report on 'Current Economic Situation And Policy Options'.
The report of the Standing Committee on Finance was tabled in the Lok Sabha by its Chairman Yashwant Sinha.
The Committee urged the government to "take urgent steps" to supplement and compliment initiatives of RBI with fiscal measures to rein in inflation and trigger sustainable growth.
In order to contain inflation, RBI had hiked the repo rate (lending rate) 13 times between March 2010 and October 2011.
RBI, the Committee noted, had told its members that fiscal part of the obligation was not being fulfilled by the government.
In order to deal with the current "gloom and doom scenario", the committee suggested that government should come out with a "well thought-out revival policy" to ensure effective decision making, time bound clearance of projects, more transparent tax regime and enhanced domestic investment.
"The Committee... Urge upon the government to take clear cut measures in this direction and implement them speedily and without fail," the report said. (MORE)
