Union Finance Minister P. Chidambaram on Thursday expressed confidence that the Indian economy would bounce back to a high annual growth rate of seven per cent in the next two years and promised adequate public spending to stimulate it.

While taking a macro view of the global economy, particularly the crisis-ridden Eurozone, Mr. Chidambaram sought to dispel fears over the current state of the country and its present growth rate of 5 to 5.5 per cent. “There is nothing to feel demoralised about it. We will register a growth of six per cent in 2013-14 and in the next year it will go up to seven per cent. This is a very sober assessment of our economy,” he said.

Replying to a lengthy discussion on the Budget for 2013-14 in the Lok Sabha, he said the government was committed to gradually lowering the fiscal deficit from the current 5.2 per cent to 4.8 per cent next year, then 4.2 per cent and ultimately to about 3 per cent by 2016-17 as the current level was “very high” and not sustainable.

While noting that there was no “serious criticism” of the budget by the members, the Finance Minister said he felt “vindicated.” He said only China and Indonesia were growing at a faster rate than India and even highly developed nations like the U.S., Japan and Canada were witnessing dismal growth rates of around two per cent.

Even as Mr. Chidambaram highlighted the flagship programmes of the United Progressive Alliance (UPA) government, amid thumping of desks by the treasury benches, the Opposition members staged noisy protests over tardy implementation of several schemes. They drew attention to the plight of farmers who were left to fend for themselves as agriculture inputs were getting costly and fertilizer prices were on the higher side.

Describing the Direct Benefit Transfer scheme as the “game changer,” Mr. Chidambaram said “Aapka Paisa, Aapke Haath” (Your money in your hands) was aimed at eliminating corruption and removing leakages from the funds transfer system. “It is a readymade programme, there may be some teething problems but India has both hardware and software expertise to overcome these and the money will go directly to the bank or post office accounts of the poor and deserving,” he said, amid applause from the treasury benches.

Stressing the UPA’s mantra of “inclusive growth,” Mr. Chidambaram said the focus of the Budget was on three unique and special characters — women, youth and poor — which were truly secular. “They cut across religions, caste and community. These real faces of India must be before us at all times while formulating programmes,” he said.

He announced that in 2013-14, one of the major programmes would be launching of the national skill development programme to benefit nearly a million people across the country.

Mr. Chidambaram assured the House that the Food Security Bill would be soon introduced in Parliament and the women’s bank would become a reality by October 31, 2013.

He expressed deep regret and anguish over the tardy implementation of some programmes like MGNREGS and JNNURM by a few State governments.

Another initiative of the UPA government, he announced, would be the introduction of nutrifarms to battle the widespread malnutrition. He said the scheme had been lauded by eminent agricultural scientist M.S. Swaminathan.

Defending the government's decision to squeeze the Plan expenditure in 2012-13, he said it was aimed at reducing fiscal deficit as the consequences could have been disastrous.

For the next fiscal (2013-14), Mr. Chidambaram said he had provided Rs. 16.65 lakh crore which was enough to stimulate growth. “No ministry or department has been given less than what they were given in the beginning of 2012-13,” he said.

The Ministries have been asked to take steps to start spending as early as in April-May with a view to stimulating growth, he informed the House.

Later, the Lok Sabha passed relevant appropriation bills by voice vote, completing the first stage of the budgetary exercise.

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