The Budget 2016-17 is guided by the ground situation rather than populism, Finance Minister Arun Jaitley today told Directors of the RBI Central Board.
The key factors of the Budget were maintaining rural focus with an emphasis on asset creation and stepping up of capital expenditure on railways, rural roads, national highways, he said addressing the customary post-Budget meeting of the Board.
Also, duty modifications to help manufacturing and continuing with reforms agenda were important focus areas.
Later talking to reporters, Jaitley said he had a detailed discussion with the members of the RBI Board.
The Minister said the opportunity was used to explain to Board some of the important features and rational behind the decisions that were announced in the Budget.
"Of course members of the Board both from within the bank and outside experts have certain suggestions and questions which are always of extreme value to us while we formulate the policies for the future...," he said.
Jaitley said there were questions/suggestions with regard to extension of the Aadhaar DBT platform to some other areas such as in passing the interest subvention benefits.
There was also discussion with regard to education loan, exports, disinvestment and the initiatives which have been taken to clean up the bank balance sheets.
"Overall, I will only say that the environment and hope created by both the initiates taken in the Budget as also the decision to stick to a certain level of fiscal discipline received a very positive nod" from members.
The RBI in a release said the Board complimented the Finance Minister on the Budget, especially the focus on strengthening agriculture, public investment, structural reforms in the social sector, as also on maintaining the fiscal consolidation path.
Issues such as macroeconomic developments and specific areas of operations of the RBI were also discussed, the release said.
RBI Governor Raghuram Rajan, Minister of State for Finance Jayant Sinha, Government nominee directors on the Central Board and Economic Affairs Secretary Shaktikanta Das, Financial Services Secretary Anjuly Chib Duggal were also present at the meeting. Three new Board members Natarajan Chandrasekharan, Bharat Narotam Doshi, Shri Sudhir Mankad also attended the meeting.
Replying to a question, Das said the third and final batch of supplementary demands for grants "will not have any impact on this year's fiscal deficit".
He also said with quota reforms at the IMF, India has to make certain payments and also maintain certain level of SDR.
"It's not an additional payout. It was already planned. It is as per the earlier plan," he added.
The government had yesterday sought Parliament's approval for gross additional expenditure of over Rs 1.12 lakh crore as part of the third and final batch of Supplementary Demands for Grants for this fiscal, including Rs 69,575.47 crore towards subscription to IMF for quota increase.
