Slump: Montek to bring out plan for extra spending in 10 days

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New Delhi, Nov 18 (UNI) Planning Commission Deputy Chairman Montek Singh Ahluwalia today said the Commission will finalise a plan in the next 10 days to enhance public expenditure on various sectors, especially the infrastructure sector.

''We are reviewing in which sectors public expenditure should be made... in the next 10 days we will have a clear picture. After that we will discuss things with the Finance Ministry,'' Dr Ahluwalia told UNI here on the sidelines of India Economic Summit.

The move will not only make up for the slowdown in private investment, but will also spur its growth. A new set of incomes will be generated by public expenditure which will propel demand, now regarded as the biggest culprit for the slowdown.

Dr Ahluwalia said the monies approved would mostly be for projects that fall in the domain of Public-Private Partnership (PPP) model.

Earlier in the day, Minister of State for Industry Ashwini Kumar said the government has finalised an extensive programme for giving stimulus to the infrastructure sector.

It is learnt that the government has decided to inject an additional Rs 50,000 crore for funding infrastructure projects in the country.

Dr Ahluwalia said the "primary focus" of the government will be to enable the the economy to bounce back in "times of uncertainty." Dr Ahluwalia felt that the economy will grow between 7-7.5 per cent in the current fiscal and felt that in the overall context there would be "no job cuts".

''These are times of uncertainty...the primary focus of the government will be to get back the economy on the normal growth path,'' he said.

Dr Ahluwalia said there are differing estimates being made by various sources relating to the projections for the current fiscal. ' He said for creating demand in the economy, there is also a need to promote exports and step up public expenditure on various sectors, including rural infrastructure.

He said with the global economic slowdown, inflation will not not remain a primary problem. What Dr Ahluwalia meant is that in a situation of slowdown in demand, commodities and crude will move Southwards bringing down domestic prices.

Dr Ahluwalia expressed optimism that the G20 meeting which concluded recently in Washington will be a solution provider to the global meltdown, resulting from co-ordinated effort, including providing fiscal stimulus, by the member countries.

The fact that the group would be meeting again in April would mean that the Obama Administration would be involved in the action plan.

He said that while regulation should continue to be national, mechanism needs to be set up for "global oversight.

He said normalcy would return to the markets only when participants are confident that no further collapse of the financial system is likely.


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