The government is very transparent in setting a new fiscal deficit target: Nirmala Sitharaman
NEW DELHI: The Union finance minister said Monday that the government has been very transparent in establishing the new one, which is set at 3.5 percent for the next financial year beginning April 1.
There are many speculations regarding the fiscal deficit. Previously, there was a situation in the previous regime in which the fiscal deficit numbers were falsified. We will not falsify the data, he said while speaking at an event held here at FICCI. .
We are putting money for the creation of public assets, connectivity to particular districts, which do not have basic infrastructure. We are very transparent in setting the new fiscal deficit target, Sitharaman added.
We expect the industry to advance the economy. The government is there to support the industry. We are putting money where assets must be created. We have given the road map. It is not sector specific. The attempt is to take a prudent route to achieve the established objectives, he added.
She also said that many people have been speculating that the fiscal deficit would cross 4 percent. We may have a situation where you want the government to spend preparing the pump economy, he said.
When asked why the sensex was not happy on Budget Day, Sitharaman said: But I see that they are happy today. Monday is the real work mood, and today's mood is that they are happy. It's not like that? Not lush but happy somehow.
The fiscal deficit target for the next financial year that begins on April 1 has been set at 3.5 percent, compared to 3.8 percent in the current fiscal year 2019-20.
This is consistent with the government's permanent commitment to macroeconomic stability as part of the 2020-21 medium-term fiscal policy cum strategy statement, Finance Minister Nirmala Sitharaman said Saturday.
In addition, it demonstrates the clear intention of the government to achieve fiscal objectives and affirm the commitment towards prudent fiscal management and increase investments, he said in presenting the Union Budget 2020-21 in Parliament.
Section 4 (2) of the Fiscal Responsibility and Budget Management Act (FRBM) 2003 establishes a trigger mechanism for a deviation from the estimated fiscal deficit due to structural reforms in the economy with unforeseen fiscal implications, Sitharaman said.
Therefore, I have taken a 0.5 percent deviation, in accordance with Section 4 (3) of the FRBM Act, both for the revised 2019-20 estimate and for the 2020-21 budget estimate, he added.