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The Fiscal Responsibility and Budget Management (FRBM) Act mandates the Government to eliminate revenue deficit by March, 2009. The elimination of revenue deficit is expected to improve public sector savings, which are currently negative. Various measures are being taken for boosting investment in manufacturing. Foreign direct investment policy has been liberalised. Tariffs have been lowered, taxes have been rationalised and tax base widened. Recognising the need for greater impetus to the manufacturing sector, the Government has set up the Investment Commission and National Manufacturing Competitiveness Council. The Union Budget for 2005-06 has proposed a number of initiatives such as emphasis on enhanced public investment, diversifying agriculture, promotion of public-private partnership for infrastructure development, liberalisation of Foreign Direct Investment (FDI) and facilitating growth in industries and services sector through an enabling policy environment. The various measures are expected to have a favourable impact on the growth of the economy.
The advance estimates released by Central Statistical Organisation (CSO) place the overall real GDP growth rate at 6.9 per cent in 2004-05 with sectoral growth rate of 1.1 per cent, 7.8 per cent and 8.9 per cent in agriculture and allied, industry and services respectively. The final growth figures for 2004-05 has not been released by the CSO.
This information was given by Shri S.S. Palanimanickam, Minister of State for Finance in reply to a question raised by Shri Vijay J. Darda in Rajya Sabha today.
BSC/BY/DN-211/05
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