Budget 2014′s message is India is ready to grow, says Jaitley

After presenting his first union budget since becoming India's finance minister, Arun Jaitley today said that the intention of the measures announced in the document was to tell the world that India is ready to return to the high economic growth part and to remove the roadblocks in the economy that had been left behind by his predecessor.

"My steps are aimed at reviving growth, the budget's message is that we are ready to grow," Jaitley said in an exclusive interview to CNBC-TV18's Shereen Bhan.

Discussing the fiscal obstacles inherited from the UPA government, finance minister Jaitley said, "The previous government had created roadblocks and I had to remove that to allow monetary traffic to flow."

In the interview, the finance minister said he was confident that his government will be able to stick to the 4.1 percent fiscal deficit target even though rating agencies have voiced skepticism.

"It's easier to push the deficit to 5 percent in the first year and then bring it down later," Jaitley said.

He said that he would prefer to lower fiscal deficit by boosting revenues rather than cutting down on expenditure. He added that his task was to provide an initial roadmap for the economy, and he felt he had been able to do that.

As regards FDI in multi-brand retail, Jaitley said he didn't think India was ready for the measures as yet.

Jaitley shared his views on the various tax issues that were at stake this budget. On the issue of the Direct Tax Code, he said that he would not be able to commit to a timeline as the review process was yet to start.

"We are not rigid on anything regarding the DTC, but I haven't had time to review it in the last 45 days," Jaitley said.

The finance minster said that as far as Goods and Services Tax was concerned there was a broad consensus within the Empowered Committee and most state finance ministers had also reconciled to GST if they were compensated. "GST is a top priority for me," he said.

Speaking about retrospective tax amendments, Jaitley said that the government would not retrospectively amend any laws to create liabilities. He added, "I don't believe UPA-2 had political space to move on the retrospective tax law."

On the issue of subsidies Jaitley said, "India hasn't found an answer to subsidies in 67 years and I was expected to find one in 45 days." He said that rationalising subsidies is the biggest challenge for the government and that an Expenditure Management Panel would look into the matter.

Jaitley said that the government was looking at PSUs that would do well on the divestment front.

 

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