New Delhi: Finance minister Pranab Mukherjee on Wednesday said that the fiscal stimulus greatly helped the economy withstand the impact of the slowdown and gave no hint of its possible rollback in the budget.
“Central excise has been used as a fiscal tool to cushion the impact of the global recession. It is reassuring to note that stimulus measures, including reduction in central excise duty, have had a positive impact on the Indian economy,” the finance minister said at the Central Excise Day.
Mukherjee also said that an impressive industrial growth of 16.8% in December suggests the economy will grow by over 7.5% in 2009-10 and over 8% in the next fiscal.
He said that the economy needs to grow by double digits to eliminate poverty and illiteracy.
To blunt the impact of the slowdown, the government had cut excise by 6% and service tax by 2% besides stepping up planned expenditure to provide a Rs1.86 lakh crore stimulus to the Indian economy.
However, with the economy back on the growth path, speculations are rife that the emergency measures may be be partially withdrawn by raising excise duty in the budget on Friday.
The finance minister, though provided no indication to that effect.