‘Let me begin with the good news. Fiscal deficit for 2013-14 will be contained at 4.6 per cent of GDP, well below the red line that I had drawn last year,’ said the Finance Minister P. Chidambaram while presenting the interim budget to the Parliament this Monday. He further announced a package of indirect tax cuts to boost spending and investment, and proudly announced its record of growth over the past decade in its last budget.
The Indian businessmen watching this speech were made happier by his estimate that the fiscal deficit would decrease further to 4.1 per cent in the year 2014-15. The Monday’s budget was an interim exercise done ahead of the election due by May. Chidambaram said factory-gate taxes on some capital goods and consumer durables would be reduced to 10 per cent and the excise duties on small cars, two wheelers and commercial vehicles would be decreased to 8 per cent from 12 per cent. He further announced small bore measures to soften the student loans and also to help retired members of the armed forces.