FM shaves off Rs 91K Cr of Plan spending in current fiscal
Finance minister P. Chidambaram shaved off Rs 91,838 crore from the budgeted Plan expenditure of Rs 5,21,025 crore for the current fiscal in the backdrop of burgeoning fiscal deficit. The budget-2013 has projected revised estimates of the Plan expenditure at Rs 4,29,187 crore for the current fiscal.
For 2013-14, the government has also raised the Plan expenditure by just 6.58 per cent to Rs 5,55,322 crore from the Budget estimates of Rs 5,21,025 crore for current fiscal.
However, the jump in the Plan expenditure for 2013-14 is 29.4 per cent when compared with the revised estimates of the same for current fiscal at Rs 4,29,187 crore.
The Plan expenditure Budget estimates for the current fiscal at Rs 5.21 lakh crore was about 18 per cent higher than the budget estimates of such expenditure at Rs 4,41,547 crore for 2011-12.
The Plan expenditure is the government spending on social sector schemes such as Bharat Nirman, rural employment guarantee scheme and National Rural Health Mission. Besides, it includes Centre’s assistance to various states and Union Territories Plans.
Chidambaram has pegged the fiscal deficit for the current fiscal at 5.2 per cent of gross domestic product and at 4.8 per cent for 2013-14. The government has targeted 5.1 per cent fiscal deficit for 2012-13 in the last year’s budget.
“In the Budget for 2012-13, the estimate of Plan expenditure was too ambitious and the estimate of Non-Plan expenditure was too conservative. Faced with huge fiscal deficit, I had no choice but to rationalise expenditure. We took a dose of bitter medicine. It seems to be working,” Chidambaram said in the Budgetary speech.
“Government expenditure boosts aggregate demand and it has both good and bad consequences. Wisdom lies in finding the correct level of government expenditure.”
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