Arun Jaitley provides a bold new direction3 min read 28 Feb 2015, 08:06 PM IST
Jaitley has shown that he is not beholden to any fiscal dogma and has his attention focused sharply on raising growth and investment
Finance minister Arun Jaitley has shown that he is not beholden to any fiscal dogma and has his attention focused sharply on raising growth and investment. As such, he has opted for a more moderate glide path for meeting the medium term fiscal deficit goal of 3% of gross domestic product (GDP). This will now be achieved over three instead of two years as earlier targeted. Accordingly, the fiscal deficit next year is pegged at 3.9%, giving the government greater fiscal space to make the much needed public investments in infrastructure and agriculture. But I would have been even happier, however, if the finance minister had chosen to reduce the revenue deficit more sharply than bringing it down only to 2.8% of the GDP in FY16.