Union Finance Minister Arun Jaitley while presenting the General Budget for 2018-19 in Parliament today, said that this Budget reflects the government’s firm commitment to substantially boost investment in agriculture, social sector, digital payments, infrastructure and employment generation while simultaneously sticking to the path of fiscal rectitude.
Jaitley said that the government’s commitment is substantiated by an increase in expenditure of Rs2,24,463cr over RE (2017-18). He said the aim is for a reduction of fiscal deficit by 0.2% of GDP over RE 2017-18. He projected a fiscal deficit of 3.3% of GDP for the year 2018-19.
He said that the present government assumed office in May 2014 when fiscal deficit was running at very high levels. fiscal deficit for 2013-14 was 4.4% of GDP. The prime minister and the government have always attached utmost priority to prudent fiscal management and controlling fiscal deficit. He said that the present government has embarked on the path of consistent fiscal reduction and consolidation in 2014. Fiscal Deficit was brought down to 4.1% in 2014-15 to 3.9% in 2015-16, and to 3.5% in 2016-17. Revised Fiscal Deficit estimates for 2017-18 are Rs5.95 lakh cr at 3.5% of GDP.
The Finance Minister said that in order to impart unquestionable credibility to the Government’s commitment for the revised fiscal glide path, he is proposing to accept key recommendations of the Fiscal Reform and Budget Management (FRBM) Committee relating to adoption of the Debt Rule and to bring down the Central Government’s Debt to GDP ratio to 40%.
The Government has also accepted the recommendation to use Fiscal Deficit target as the key operational parameter. Necessary amendment proposals are included in the Finance Bill, Jaitley pointed out.