With green shoots emerging after first quarter GDP figures showed a pick-up in economic growth at 5.7 per cent against 4.7 per cent in the same quarter last year, Finance Minister Arun Jaitley has some reason to cheer.

Sharing some of his optimism with the media last week-end, Jaitley said the first quarter growth rate was “encouraging” and with the long-term impact of all the new initiatives taken by the Government setting in, he was “sure that the impact in the coming quarter would be much larger.”

However, inflation continues to be a cause for concern, despite some moderation, he said adding that more sectors were indicating a positive trend.

Asked about when interest rate cuts can be expected, the Finance Minister said, “Left to myself, I would say, very soon. I hope that those who decide are also listening.”

Deficit concern

Jaitley said the fiscal deficit figures in the first quarter (56.1 per cent of the Budget target) do not represent the pattern of the whole year. Tax collection, particularly advance taxes, have not yet started coming in, he said, adding the first quarter was also burdened with the refund of the last quarter of the last fiscal. A combination of these factors does not represent a proper state of the fiscal deficit, he admitted.

“I gave a target of fiscal deficit of 4.1 per cent in the Budget. I, at that stage, said that the figure given by my predecessor in the vote of account appears a daunting task, but I accepted the challenge and it would be my endeavour to meet that. So what was I accepting as a challenge, today I feel with first quarter GDP numbers, as something which is certainly achievable.” He said.

Hopeful of a consensus on the Goods and Services Tax, Jaitley said too many items cannot be kept out of it as the larger objective would get defeated. “I have already discussed the issue with the Finance Minister of Gujarat and intend to meet other States that have some issues,” he added.

Coal blocks

The Finance Minister said the impact on the recent Supreme Court ruling on coal block allocations already made would depend on how and what shape the litigation further takes.

However, he said the silver lining in the judgment was that it moved the system towards a fairer methodology of allocation of natural resources. “But we can’t allow the fate of the coal blocks to hang in mid-air, he said.

He hoped a decision, either way, does not linger.

On another major reform step – the insurance Bill – which is with the Select Committee at present, the Finance Minister said, “I don’t think we have to go so far (calling a joint session of Parliament).”

He said he was “reasonably confident because any political party (read Congress) which mooted the idea of this Bill in the past, can’t have any serious reservations against it,” he said, adding that “I do see positive attitude from the principal Opposition party.”

Jaitley said the Select Committee would soon start its work on the Bill, and was hopeful of its passage in the next session.

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