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Finance Minister Arun Jaitley on Monday asked State Finance Secretaries to maintain fiscal discipline, noting that meeting the 3.9 per cent target of 2015-16 has brought immediate gains of lower interest rate and better credibility in the global economy.
“…all of us will have to spend within means. We have seen that ever since we have shown this tendency of spending more yet sticking to fiscal discipline, this has brought immediate results in terms of interest rates and India's credibility,” he said at the second conference of State Finance Secretaries.
The Centre has decided to lower the fiscal deficit to 3.5 per cent of the GDP in 2016-17.
He also asked States to ensure that spending is in developmental activities in sectors such as the social sector, infrastructure creation and rural areas. “The tendency to spend it on non- developmental activities may in the short term appear to be attractive but in longer run it doesn't reap results,” he stressed.
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