India in better shape than any other country: Sibal

April 1st, 2009 - 10:05 pm ICT by IANS  

Bharatiya Janata Party New Delhi, April 1 (IANS) India is in a better situation than any other country in the world when it comes to fiscal deficits and beating the slowdown, Science and Technology Minister Kapil Sibal said here Wednesday.
Speaking at a CNBC seminar on Impact of Polls on Markets, Sibal said: “I feel that we are in much better situation compared to other countries. We are still hiring. So things are much better as compared to the US.

“I feel India will be growing somewhere between 6.5 to 7.1 percent,” he added.

However, Bharatiya Janata Party (BJP) leader Arun Jaitley challenged Sibal. “There has been no significant decision made in the last four months, there has been no important meeting and, above all, no finance minister. So what is the government doing for the economy? They inherited a robust economy and what they left is this!”

Communist Party of India-Marxist (CPI-M) leader Sitaram Yechury added: “The government is talking about attracting foreign investment and investors. But what can beat the recession is generating domestic demand.

“What kind of India shining and Bharat Nirman they are talking of when millions of people have lost their jobs, when the consumer prices are going up?”

Moving to the fiscal deficit, which is in excess of Rs.3.07 trillion or $61 billion from April 2008 to February 2009, Sibal did not think of it as a problem.

“If you have to give fiscal packages, stimulus packages, there will be fiscal deficit,” Sibal said.

Yechury too believed that preoccupation with reducing fiscal deficit will serve no purpose. “Pre-occupation with fiscal deficits during slowdown makes no sense and is not common sense. The best way is to monetise this deficit. About 10 percent of GDP should be spent on public investment,” he said.

Earlier, terming the government’s projection of 11 percent fiscal deficit as “gross underestimation”, BJP leader Arun Shourie said: “Irrespective of whichever government comes to power after the Lok Sabha polls, the deficit will be 13-14 percent of GDP.”

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