Brushing aside the controversy over the draft CAG report on coal blocks allocations, Union Finance Minister Pranab Mukherjee said on Saturday that most of the issues would be addressed in due course.
On the Comptroller and Auditor-General's draft report, Mr. Mukherjee stressed at a FICCI meeting here that usually 90 per cent of the issues raised by the CAG were dropped at the clarification and exit conference levels. “That is the normal practice and it has been going on for 150 years.” It was just a draft and the CAG was yet to finalise its report. It was an unnecessary sensationalisation of an issue when several more parliamentary processes needed to be completed before reaching a conclusion.
He said it was the job of Parliament to take a call. It would go to the Public Accounts Committee, which in turn would report to Parliament on all aspects raised by the CAG.
The CAG, in its draft report, hinted at the possibility of a shortfall of about Rs. 10 lakh crore in realisation in the allocation of coal blocks.
Mr. Mukherjee warned that the government would take tough measures in tune with budget proclamations to tackle its fiscal position. The Minister, however, added that capping subsidies would require the support of the political parties, industry and the civil society.
Referring to the state of the economy, Mr. Mukherjee hinted at difficult decisions in the coming months and for that the government would have to drive a hard bargain with all political parties and other stakeholders.
Mr. Mukherjee's objective is to cap subsidies and mobilise additional resources and control expenditure to meet the targets he had outlined in the budget.
However, he was confident of taking forward reforms and regaining the growth momentum, stressing that the current situation was not dissimilar to the 1990s when there was no clear majority for any party. “If we could face the challenges, then there is no reason why we can't face them now.”
Taking industry into confidence, the Finance Minister said that without its cooperation and those of the larger political establishment and the civil society “we can't be equal to the gigantic task at hand.”
Intending to adhere to a path in line with ground realities, Mr. Mukherjee indicated the unlikelihood of his sticking to the budget exercise and announcements saying that it served no purpose if these could not be pursued.
The Minister expected inflation to ease and moderate and the interest rates to ease to the benefit of industry. He hinted at the possibility of reversal of the policy rate in the coming months, but crude oil prices could temper the RBI's perception on the quantum of rate cut.