he action taken to arrest the short fall and achieve the targeted growth rate in the remaining period of the Five Year Plan in respect of domestic saving?
he action taken to arrest the short fall and achieve the targeted growth rate in the remaining period of the Five Year Plan in respect of domestic saving?
MINISTER OF STATE IN THE MINISTRY OF FINANCE ( SHRI BALASAHEB VIKHE PATIL)
As per the Mid Term Appraisal of Ninth Five Year
Plan (1997-2002) brought out by the Planning Commission, the
Main shortfall in domestic savings has been in the
Public sector, which is 70 per cent below the target. This
has occurred through both a worsening of fiscal position of the
Centre and State Governments and a lower-than-expected generation
of internal resources by public sector enterprises. With a view
to achieve fiscal consolidation, the Budget for 2001-02
emphasises expenditure management through the process of
bringing about structural changes in the composition of Central
Government expenditure, economy in non-plan revenue expenditure
while improving the quality of expenditure. To this end the
Budget contains a number of initiatives which among others include
restricting fresh recruitment to one per cent of total civilian
staff strength, user charges for services provided by the
Government and its agencies to be revised keeping in view the increased
Cost of these services etc. Further, with a view to reduce interest
burden, most administered interest rates were reduced by 1.5 per
cent as of March 1, 2001. Besides, the Fiscal Responsibility
and Budget Management Bill, 2000 was introduced in Parliament
in Decembner, 2000. This Bill includes provisions relating to
ceiling on debt, deficit and borrowing. Also it is Central
Government`s endeavour to work jointly with the States to reform their
Finances. Pursuant to the recommendations of the Eleventh Finance
Commission, an Incentive Fund of Rs.10,607 crore has been
earmarked for the next five years to encourage States to implement
monitorable fiscal reforms. For increasing aggregate savings in
the Economy it is also imparative to improve the parameters which
have a bearing on private savings. This includes tax policies,
monetary policy, inflation efficiency of the Banking system and
the capital market and confidence in economy apart from measures
aimed at fiscal consolidation to improve public savings.
The various economic reforms measures undertaken so far and measures
Announced in this years`s Budget to contain expenditure in
Particular are expected to have a favourable impact on
Aggregate level of savings.