Union Finance Minister Pranab Mukherjee on Monday assured industry that the stimulus package would not be undone till the economy was firmly on the recovery path.
Speaking at a function organised by the Confederation of Indian Industry (CII), Mr. Mukherjee ruled out any fresh stimulus package but told industry that the withdrawal of the current measures would not be done till a strong recovery of the economy was in place as it had cushioned the common man from the global meltdown.
He also allayed fears that the private sector would feel the pinch of resources on account of the high fiscal deficit. He contended that the low credit offtake and ample liquidity proved that these fears were misplaced.
Mr. Mukherjee called for competition to check rise in prices of agricultural commodities. He blamed it on the imperfections in the agriculture markets to the present spate in foodgrains.
Pointing out that neither the farmers received a remunerative price for their output nor the consumers got their purchase at a fair price, Mr. Mukherjee said that a chain of intermediaries worked against competition.
Cabinet Secretary K. M. Chandrashekhar too stressed that the various components that comprised the stimulus package would not be withdrawn at one and the same time whenever the government contemplated to reverse the process as and when the economy recovered.
In his opinion it was unlikely that the rollback would be initiated during the current fiscal year and said that it would be continued as of now.
Even as he stressed that these would not be undone at one go, Mr. Chandrashekhar emphasised that not the entire package would be withdrawn. “Certain things might be retained, while others might be withdrawn,” he said even as he declined to specify the measures that would be rolled back.
He attributed the rise in sugar prices to the global trend affected by acute shortage and said the government was keeping a close watch on the situation in the domestic market. He added that the sugar prices were pretty high around the world because of shortage.
Mr. Chandrashekhar ruled out any possibility of imports of wheat saying that the situation was quite comfortable.