Exuding confidence that the economy will grow by 8.5 per cent in 2011-12, the Finance Minister, Mr Pranab Mukherjee, today said the recent hike in prices of petroleum products and restructuring of duties on them will not have much impact on the fiscal deficit.
Asked if he will consider rolling back the increase in prices of cooking gas (LPG), diesel and kerosene amidst demands from various quarters, the minister said, “No...No question of revoking (price hike)”.
As regards the impact of the decision to cut duties on the fiscal deficit, he said the shortfall would be made good by buoyancy in tax collection and improved compliance.
“I do not think so because this was the conscious decision... About Rs 49,000 crore will be the shortfall in the duty. I think it would be possible for us to make it up through buoyancy and by better compliance,” Mr Mukherjee told PTI in an interview.
The Government proposes to reduce fiscal deficit to 4.6 per cent of the GDP in 2011-12 from 4.7 per cent a year ago.
The economy, the minister hoped, would grow by around 8.5 per cent during the current fiscal, the same rate which was recorded during 2010-11.
“I am still holding the projection which I had that is 8.5 per cent plus... We shall have to wait for sometime. But it would not be less than 8 per cent plus,” he said.