New Delhi: Finance Minister Pranab Mukherjee today said meeting 4.6 per cent fiscal deficit target for the year ended March 2012 will be a “great challenge” due to high commodity prices and slump in global economy.
“With the crude prices remaining where they are, it will be a great challenge to maintain the fiscal deficit numbers at 4.6 per cent this year. However, we will make strenuous attempts to keep the fiscal deficit at around these numbers,” he said after inaugurating the Economic Editors conference here.
He said the international crude oil prices have continued to remain at or above 105 dollars per barrel.
Mr Mukherjee said the government would be monitoring revenue and expenditure trends and take steps as deemed appropriate.
“The fiscal policy stance for 2011-12 remained broadly on the consolidation track, complementing the monetary policy stance.
We presume 4.6 per cent fiscal deficit this fiscal. We had originally planned for 5.5 per cent fiscal deficit for the year 2010-11,” he said.
Mr Mukherjee said the fiscal deficit was brought down to 4.7 per cent in 2010-11 due to huge inflows on 3G auctions.
“One of the largest fiscal corrections was achieved in fiscal 2010-11 when fiscal deficit/GDP ratio declined to 4.7 per cent from a level of 6.4 per cent in 2009-10,” he said.
With a disinvestment target of Rs 40,000 crore for the current fiscal, the government has only raised Rs 1,144 crore from a stake sale in Power Finance Corporation (PFC).
The Income Tax Department has decided to raise the direct tax collection target for the current fiscal by Rs 53,000 crore to Rs 5.85 lakh crore.
To meet the expenditure requirements in the second half of the fiscal, the government had decided to borrow Rs 52,800 crore more from the market, over-and-above the Rs 4.17 lakh crore budget plan for the fiscal.