Fiscal deficit is a strategy to spur growth: FM

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New Delhi, Jul 7: After presenting the Union Budget 2009-10 which received mixed reaction from industries and experts, the Finance Minister, Pranab Mukherjee met India Inc on Tuesday, Jul 7 to clarify on the high fiscal deficit of 6.8 per cent.

The Finance Minister told India Inc that the high fiscal deficit was a strategy to spur growth. He, however, vowed that the government would work towards bringing it down to 4 per cent in the coming two fiscals.

Admitting that 6.8 pc of fiscal deficit was on the higher side, the finance minister said, "The global economic slowdown is likely to continue in the current financial year... (but) we must come back to growth path as fast as possible."

"No doubt, I have taken a risk...We cannot say we are out of the economic slowdown as yet," he added.

He said that the government has set a target of bringing down the fiscal deficit to 5.5 per cent in 2010-11 and 2011-12. Repeating what he already told at the Budget presentation, he said, "A single budget cannot solve all the problems."

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