Fiscal deficit needs downward correction in 2 yrs: Jaitley

–Jaitley: Economic survey only shows gravity of econ situation

–Fiscal deficit needs to move downwards in next 2 yrs

–Current economic situation needs correction

–Inflation needs to be moderated “a lot more”

New Delhi: Finance Minister Arun Jaitley today said India’s fiscal deficit, which was at 4.5% of gross domestic product in the year ended March, needs to be narrowed over the next two years.

“It (Economic Survey) only shows the gravity of the economic situation and it requires correction…fiscal deficit this year (2013-14) is 4.5% and requires a downward movement over next two years,” Jaitley said.

Jaitley was talking to reporters after presenting the Economic Survey for 2013-14 (Apr-Mar) in Parliament.

The survey estimated the Indian economy to grow 5.4-5.9% in 2014-15 (Apr-Mar) after two successive years of sub-5% growth.

According to the fiscal consolidation roadmap outlined by the previous government, the fiscal deficit is to be reduced to 3.0% of GDP in 2016-17.

The Interim Budget, presented by the previous government, had projected the fiscal deficit in 2014-15 to narrow to 4.1% of GDP.

Jaitley will present the regular budget for 2014-15 on Thursday. The finance minister also said “inflation needs to moderate a lot more”.

Inflation has eased, but was still above the comfort level, said the Economic Survey, adding that moderation in price rise would provide room for monetary policy easing.