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Govt may peg fiscal deficit at 5% to battle slowdown

Govt may peg fiscal deficit at 5% to battle slowdown
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First Published: Sun, Feb 15 2009. 01 38 PM IST
Updated: Sun, Feb 15 2009. 01 38 PM IST
By PTI
New Delhi: Trying to fight global slowdown and gearing up for the forthcoming elections, the UPA government’s interim budget is likely to step up expenditure on its flagship programmes, rural development and housing, doubling the fiscal deficit to 5% during 2009-10.
The interim Budget, to be presented by external affairs minister Pranab Mukherjee who is currently holding the charge of Finance Ministry, is also likely to announce short-term measures for exporters reeling under the impact of a global slowdown.
The government in the last Budget has fixed the fiscal deficit for the current fiscal at 2.5% of GDP, which is likely to be raised to 5% for the next fiscal, primarily on account of higher allocations towards the government’s flagship schemes like the Bharat Nirman and the National Rural Employment Guarantee Scheme.
To provide focus on urban infrastructure, the government may expand the ambit of the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) to include more districts. At present, the scheme is operational in about 60 mission cities.
The other focus of the budget is likely to be on rural development, which may witness allocations going up to more than Rs55,000 crore from Rs39,000 crore, an increase of over 40%.
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First Published: Sun, Feb 15 2009. 01 38 PM IST