Measures soon to revive growth: Arun Jaitley

Amid concerns over the slowing economic growth, the government has decided to go for a stimulus package to boost growth, Finance Minister Arun Jaitley said on Wednesday.

Jaitley said that the government is working on additional measures to bolster economy. "We have taken note of all economic indicators that are available. The government will take any additional moves which are necessary. I am not in a position to announce today in the press conference. I will be certainly consulting the Prime Minister before that and when we decide, you will come to know," he told reporters, adding that this is a proactive government and has been reacting to the situation as when the situation demanded.

Jaitley has held a series of meetings in the past few days with some of his ministerial colleagues and senior government officials to take stock of the situation and firm up steps to push growth.

On Tuesday, he held a review meeting which was attended by Commerce Minister Suresh Prabhu, Railway Minister Piyush Goyal and Niti Aayog Vice-Chairman Rajiv Kumar. Among others, Additional Principal Secretary to the Prime Minister, PK Misra, Commerce Secretary Rita Teaotia, secretaries of the Finance Ministry and Chief Economic Advisor Arvind Subramanian were also part of the deliberations.

Some more meetings with other departments are to be held over the next few days and after consultations, the assessments will be laid in front of Prime Minister Narendra Modi for recommendation of a suitable package, said Jaitley.

In the first quarter ended June, India's GDP growth hit a three-year low of 5.7 per cent.

On the flip side, retail inflation hit a five-month high of 3.36 per cent in August. The current account deficit (CAD), the difference between inflow and outflow of foreign exchange, rose to 2.4 per cent of GDP in April-June.

Responding to queries on fears of spurt in inflation owing to record petrol prices, Jaitley pointed out that retail inflation at 3.7 per cent was lower than the central bank's medium-term target of 4-4.5 per cent and substantially lower than what was prevalent during the previous regimes. "During the monsoons, vegetable prices generally go up. This is spike period. When it is 3.36 per cent in the spike period, it is under control as per the traditional Indian standard," he said.

Sectoral reasons and action plans would be prepared, reported PTI quoting sources. High-level discussions with ministries such as the railways have been held to assess the capital requirement for the year, said the report.

Jaitley indicated that the government was not in favour of lowering taxes on petrol and diesel prices owing to spending required for building of infrastructure including highways. The government needs revenue to support public spending without which growth will suffer, he said.

He also alleged that any reduction in fuel prices in the past was countered by higher levies by respective state governments, belonging to the same political parties who are now criticising the government on higher fuel prices.

"You should remember that the government needs revenue to run. How will you build highways?" he said. "The government has increased public spending on infrastructure... Whatever (GDP) growth is there, it is fuelled by public spending and FDI. If public spending is slashed, it will mean cutting down expenditure on social sector scheme."

There is hardly any private investment, he said.

He was responding to questions from reporters at the weekly Cabinet meeting on whether the government would consider cutting excise duty.

On the cards

Jaitley says govt has taken note of economic indicators, and will make all additional moves needed 
Says he has held a series of discussions with his colleagues, secretaries, experts within govt