Fiscal deficit target a red line that will never be breached: Chidambaram - NDTV

New Delhi: India will limit the fiscal deficit for 2013-14 to below 4.8 per cent of the gross domestic product (GDP), Finance Minister P. Chidambaram said today at an event, adding that the fiscal deficit target is a red line that would never, never be breached. The fiscal deficit for 2012-13 is expected to be around 5 per cent of the GDP, government sources had said earlier this month. However, the Finance Minister said the current account deficit, which is likely to be below 5 per cent of the GDP in 2012-13, is more worrying than the fiscal deficit. Mr Chidambaram's statements follow an optimistic assessment of the state of the economy by the Prime Minister's Economic Advisory Council (PMEAC) on Tuesday. PMEAC Chairman C. Rangarajan told reporters that India's worst economic slowdown in a decade has bottomed out and growth is expected to pick up to 6.4 percent in the current fiscal year. The PMEAC said it expects the full-year current account deficit, seen as the main worry for the economy, to narrow to 4.7 percent in the current financial year from 5.1 percent last year, helped by higher exports and lower gold imports. On the proposed goods and service taxes (GST), Mr Chidambaram said there is a 70 per cent chance that the GST Bill will be tabled in Parliament in the next 13 months. The implementation of GST, touted as the most significant indirect tax reform since the introduction of state-level value added tax (VAT), has been delayed by three years because of a lack of consensus on several issues between the Centre and the states. Once implemented, the GST will subsume indirect taxes, like excise duty and service tax at the central level and value added tax at the state level, besides other local levies. The Indian economy will continue on its path to reforms and the government will take more executive action in the next two to four months, the Finance Minister said today. In its assessement yesterday, the PMEAC said the government needs to do more in the coming months to facilitate new investments, adding that speedy execution of projects coupled with a normal monsoon will usher in a broad-based economic recovery. Capital investment growth in Asia's third-largest economy has slowed down to at least an eight-year low as regulatory hurdles have stalled more than  Rs 7,00,000 crore big infrastructure projects, leaving investors wary and frustrated. Prime Minister Manmohan Singh has set up a panel -- the Cabinet Committee on Investment (CCI) -- to expedite regulatory clearances for major projects. On Monday, the panel cleared several energy and power projects worth crores. With inputs from agencies via Business - Google News http://news.google.com/news/url?sa=t&fd=R&usg=AFQjCNFqF1WPcko7NELPpn5xy5ZbId060g&url=http://profit.ndtv.com/news/economy/article-fiscal-deficit-target-a-red-line-that-will-never-be-breached-chidambaram-321342

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