The Finance minister ruled out giving a fiscal stimulus on Sunday to support growth of economy. India’s GDP growth touched a three year low figure of 5.7 per cent in the first quarter of current fiscal.
New Delhi : Niti Aayog Vice Chairman Rajiv Kumar has pitched for fiscal stimulus to boost growth with a rider that additional expenditure should be used only for increasing productivity and capital expenditure. Faced with slowing economic growth, the industry has been clamouring for a stimulus package from the government. “I do see a case for stimulus,” Kumar told PTI in an interview. He added however that additional expenditure should be used judiciously. Kumar’s comments come amid Finance Minister Arun Jaitley saying that he has not promised any fiscal stimulus, but would respond to the emerging situation.
“I have not used that phrase (fiscal stimulus). I said, we will respond to situations and your fraternity translated the word respond as meaning stimulus. So, you are the ones who should be answering and not me,” the minister told reporters in Washington yesterday in response to a question.
Jaitley’s remarks followed increased speculation over a possible fiscal stimulus that can go above Rs 40,000 crore after six successive quarters of dip in the economic growth, which slid to 3-year low of 5.7 per cent in the April-June quarter.