nrj
Ambassador
- Joined
- Nov 16, 2009
- Messages
- 9,658
- Likes
- 3,911
Prime Minister Manmohan Singh on Friday hinted at tough fiscal measures, including possible deregulation of fuel prices, cut in subsidies and divestment, but cautioned that this could be done only if it was politically feasible.
The prime minister was speaking with the Indian media on Friday at the end of the two-day G20 Summit in the French tourist Riviera of Cannes.
Reiterating that he has always been an advocate of fiscal consolidation, he said that we must not live beyond our means as money simply does not grow on trees. He also added that government expenditure must also be curbed.
"We must thus seriously try to cut the fiscal deficit down to 4.6 per cent and bring the fiscal system back in balance, consistent with availability of resources."
The prime minister's comments assume significance in the context of stiff opposition to the hike in petrol prices under the deregulated system.
The prices of diesel, LPG and kerosene are still administered by the government and are not deregulated yet. Replying to a question on inflation, Singh said food inflation is a problem.
While the food grains prices are relatively stable, the problem was with the secondary and tertiary food items like vegetables, egg and fish.
This, he said, was a reflection of demand exceeding supply and was also a sign of increasing prosperity.
Singh said while analysing food inflation the increase in the net income by 8 per cent per annum and the population increase by 1.6 per cent should not be lost sight of.
Deregulation and decontrol is the direction India should move in, the prime minister said, adding that these (hike in petrol prices, for example) are sensitive areas and "we must allow markets to find their own level."
However, he emphasised that the direction of change is clear: India needs to move towards decontrol.
PM advocates further deregulation of fuel prices - Rediff.com Business
The prime minister was speaking with the Indian media on Friday at the end of the two-day G20 Summit in the French tourist Riviera of Cannes.
Reiterating that he has always been an advocate of fiscal consolidation, he said that we must not live beyond our means as money simply does not grow on trees. He also added that government expenditure must also be curbed.
"We must thus seriously try to cut the fiscal deficit down to 4.6 per cent and bring the fiscal system back in balance, consistent with availability of resources."
The prime minister's comments assume significance in the context of stiff opposition to the hike in petrol prices under the deregulated system.
The prices of diesel, LPG and kerosene are still administered by the government and are not deregulated yet. Replying to a question on inflation, Singh said food inflation is a problem.
While the food grains prices are relatively stable, the problem was with the secondary and tertiary food items like vegetables, egg and fish.
This, he said, was a reflection of demand exceeding supply and was also a sign of increasing prosperity.
Singh said while analysing food inflation the increase in the net income by 8 per cent per annum and the population increase by 1.6 per cent should not be lost sight of.
Deregulation and decontrol is the direction India should move in, the prime minister said, adding that these (hike in petrol prices, for example) are sensitive areas and "we must allow markets to find their own level."
However, he emphasised that the direction of change is clear: India needs to move towards decontrol.
PM advocates further deregulation of fuel prices - Rediff.com Business