Asserting that the economy is going to become stronger due to the efforts of the present UPA Government, Finance Minister P Chidambaram today said that the current account deficit has been brought down significantly to $32 billion and the fiscal deficit contained within the target in 2013-14.

Chidambaram, however, said there has been a shortfall in overall tax collection during last fiscal.

“We are completely satisfied that we will achieve the fiscal deficit target as projected in the interim budget (4.6 per cent of GDP during 2013-14).

“The news on current account deficit is of course extremely good. CAD for the year that ended will be only $32 billion against the previous year’s $88 billion,” he said in a media briefing at Congress party office here.

CAD has not only been fully and safely financed but $28.5 billion has also been added to the reserves, he said.

In 2012-13, CAD was at 4.7 per cent of GDP and in 2013-14, it will be only 1.7 per cent, the Finance Minister said.

“So these are good signs...The economy going forward can only become stronger,” the Finance Minister said.

Stock market rise

To a query on the recent rise in stock market and Modi factor, Chidambaram said: “if you attribute every rise to quote unquote to borrow your language ‘Mr Modi is coming’ then every dip must also be attributed to Mr Modi is coming. Please don’t make that fatal mistake. What has this got to do with who is going to be elected on May 16 (the vote counting day).’’

He said what is happening in the capital market is a reflection that investors are becoming more confident about the stability and strength of India’s economy.

Tax collections

Talking about tax collections, Chidambaram said the revenues are “more or less as expected’’.

In the direct taxes segment, the Government has collected about Rs 5,500 crore more than the revised estimate (Rs 6,41,835 crore) during 2013-14.

On indirect taxes, the Government has achieved the target for Customs, but in the Central Excise and Service Tax segments, there has been a shortfall “resulting in a net shortfall of indirect tax of about Rs 17,000 crore”, he said.

(This article was published on April 26, 2014)
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