"The Union Budget of 201213 is a massive exercise in the reining in of fiscal, revenue and current account deficits while controlling inflation," he said at an interactive session at the Bengal Chamber of Commerce and Industry here. Maintaining of the trajectory of growth upwards around 7.6 per cent is also a principal objective, he said.
"Keeping the issue of unpredictability of the global economy in mind one needs to realise that the Union government is now confronted with the huge task of controlling subsidies and cutting down on wasteful expenditure and borrowings," Mukherjee emphasised.
The plan to non-plan ratio is still somewhat involuntarily highly skewed in favour of the latter leaving the former very little or no scope to manoeuvre with. While the proposed debt to GDP ratio is pegged at 45.5 per cent from last year's 50.1, realistic projections have also been made to the reducing of subsidies to below 2 per cent of GDP and a further low to 1.7 per cent in next three years.
Even in a situation when the world economy is virtually on a tailspin for the past couple of years, Indian economy has mostly tried to keep itself insulated from such volatility and excesses, he said. Networking for the proposed GST is likely to go off soon and once the system is in place, it will immensely benefit the state coffers, he added.
Networking for the proposed GST is likely to go off soon and once the system is in place, it will immensely benefit the state coffers, he added.
Mukherjee said that he had tried to mop up additional resources to give credibility to fiscal consolidation efforts and also to meet the objective of reaching Goods and Services Tax (GST).
The cardinal principle of GST was to bring in alignment of taxes for which the excise and services tax had been brought on par in the Budget for 2012-13.
He said that he was not able to make any dramatic announcement and decision in the Budget.
Noting that since 1989, the Indian electorate had been giving a fractured mandate with no party having clear majority, he said, "You can have the power to rule, but you will have to take others together. So within these constraints, I had to formulate the proposals."
The finance minister said that the government was committed to Lokpal Bill which had been cleared in the Lok Sabha and it would be taken up in the Rajya Sabha.
"There is no shortcut. I can't ignore ground reality. We have to build up consensus and the entire issue is time consuming and strenuous," Mukherjee said.
Noting that import duty on gold has been increased from 2 to 4%, Mukherjee said, "USD 46 billion has been spent for import of gold in last 10 months and USD 171 billion has been spent for the import of petroleum products. We need to take a collective decision on it."
Regarding ongoing strike on gold issue, Mukherjee said that the government would take a decision in appropriate time.
On food and fertiliser subsidies, he said that in the Budget it was said that it would be selective.
"I have pegged the subsidy burden at two% of GDP," he said.