If there is a new phrase in the Economic Survey’s lexicon that left some industry observers and several aam aadmis stumped, it was “fiscal marksmanship” , which appears about eight times in one chapter.

The Survey 2012-13, which has a huge imprint of the economic thought process of Chief Economic Advisor Raghuram Rajan was replete with the phrase “fiscal marksmanship” in the chapter on public finance.

For the uninitiated, ‘fiscal marksmanship’ refers to precision or accuracy of forecast, targets, and estimates in, say, a budget-making exercise.

For instance, it has highlighted that addressing the key fiscal risk of petroleum subsidies was critical in better “fiscal marksmanship”.

With the recent reforms in diesel prices and efforts at expenditure re-prioritisation, the medium-term fiscal consolidation plan is credible and could yet again yield macroeconomic dividends in terms of higher growth and price stability, the Survey says.

Going forward, it says ‘fiscal marksmanship’ in expenditure will depend on the emerging trends in key components such as subsidies, interest payments and pay allowances and pension.

The Survey points also out that Government’s fiscal policy is evaluated not only on overall ‘fiscal marksmanship’ in terms of fiscal and revenue deficits, which are, in effect, derived indicators, but also on marksmanship in terms of key revenue and expenditure targets.

It also highlights that in the immediate post-Fiscal Responsibility and Budgetary Management period, ‘fiscal marksmanship’ of the Central Government had a series of over-performances to its credit, except in 2008-09 and in 2011-12.

While overshooting of the deficit targets in 2008-09 was a conscious decision to obviate the adverse impact of the global financial crisis, the large slippage in 2011-12 was due to a confluence of adverse economic outcomes arising from global and domestic factors, it adds.

> srivats.kr@thehindu.co.in

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