The Hindu : Front Page : ‘Centre looking at cutting subsidies’

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Wednesday, Nov 04, 2009
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‘Centre looking at cutting subsidies’

Special Correspondent

NEW DELHI: Union Finance Minister Pranab Mukherjee has ruled out withdrawing the fiscal stimulus packages until the economy returns to a firm growth track. .

Inaugurating the Economic Editors’ Conference here on Tuesday, he said: “I have stated very clearly, I am not thinking of resorting to exit strategy [from stimulus packages] right now… I maintain that the fiscal stimulus will have to continue, to allow its impact fully through the economy...”

Mr. Mukherjee said he would take a call on withdrawing the stimulus packages after being convinced that the economy came out of the slowdown. “I have not yet seen even the second quarter [GDP growth numbers] results. After seeing the results of quarter two and quarter three, I will take a view on it.” In his interaction with senior media leaders, Mr. Mukherjee, however, said it was imperative to return to fiscal discipline “as soon as the current economic circumstances permit us to do so.” The government was “looking quite closely” at ways of cutting non-plan expenditure, especially subsidies on fertilizer and petroleum products. The subsidy on fertilizer alone is estimated to be Rs. 55,000 crore for the current fiscal.

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