Fiscal deficit

One casualty of the lowered growth rate of GDP in the current year is the target for fiscal deficit. It will be difficult to limit it to 5.3 per cent of GDP. The high level of government’s cash balances in the Reserve Bank of India is an indicator of the attempt to cut down Plan and non-Plan expenditures. But what should worry the public is the probability that tax refunds will be postponed to the next year since government accounts are on a cash, and not accrual, basis. To be transparent, the Government should mention in the Budget documents the amount of outstanding bills, refunds, and so on, at the end of 2012-13.

A. Seshan

Mumbai

Growth worries

This refers to the editorial ‘‘On a Hindu growth path’’? ( Business Line, February 8). The estimated GDP growth of 5 per cent during this fiscal by the Central Statistics Office is worrisome. The economic reforms initiated by the Government are praiseworthy, but the same has not yet started paying dividends. The Government has not yet been able to control fiscal deficit, despite repeated warnings by RBI. The central bank’s lowering its projected inflation rate to 6.8 per cent from 7.5 per cent by March 2013 is encouraging, provided the Government takes concrete steps and adopts strong economic measures to stimulate business.

The vacant Railway land needs to be utilised by the Ministry of Railways for business based on PPP, with a view to using the funds for the development of cash- strapped Railways.

Jayant Mukherjee

Kolkata

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