India needs govt commitment on fiscal consolidation: Gokarn
Published on Mon, Feb 06, 2012 at 12:16 | Source : Reuters
Updated at Mon, Feb 06, 2012 at 17:47
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India needs govt commitment on fiscal consolidation: Gokarn
The government needs to commit to fiscal consolidation for supporting growth, Subir Gokarn, a deputy governor at the country's central bank, said on Monday.
The government needs to commit to fiscal consolidation for supporting growth, Subir Gokarn, a deputy governor at the country's central bank, said on Monday.
Gokarn said that reining in fiscal deficit was doable.
India is on course to miss the 2011-12 fiscal deficit target of 4.6% of GDP. Many private economists believe the country will miss the target by almost a percentage point.
"We can not discount the importance of fiscal consolidation contributing to growth. It is not that we get growth first and then we get fiscal consolidation. They are inter-related, they do feedback into each other and I think you've got to be realistic about what that growth rate might be. You know its great if its 9 or 9 plus but when you add up everything that happened between 2003 and 2008 I think you got to be a little realistic that those conditions will not be replicated now. You wil have to discount somewhat for the growth," he explains.
