Finance Minister, Shri Pranab Mukherjee expressed confidence over the overall performance of the economy and the growth projections for the current year 2010-11. The Finance Minister said that the same would be met and the year would end with a better than projected fiscal balance and a more moderate inflation. Speaking to the media persons, here today, the Finance Minister said that in the past few days, there has been some volatility in the Capital Markets, led by continued selling pressures from the FIIs. While the stock market has its own mind and it takes cues from developments all around, the Finance Minister reiterated that the fundamentals of the Indian economy are strong. 

Finance Minister, Shri Mukherjee said that the Quick Estimates of National Income, released a few days ago by the Central Statistical Organisation (CSO), suggests that the stimulus led recovery in 2009-10 was stronger than earlier believed. He said that growth rate of GDP has been revised from 7.4 to 8.0 per cent in 2009-10 and from 6.7 to 6.8 per cent in 2008-09. Shri Mukherjee said more importantly, both savings and investment growth have shown a strong rebound in 2009-10 over the preceding year. This augurs well for sustaining high growth of the economy in the medium to long term, the Finance Minister noted. 

Finance Minister Shri Mukherjee said that in the first half of current fiscal, broad based GDP growth at 8.9 per cent has taken the economy back to the pre-crisis growth momentum. He said that the fiscal performance of the Government has also been very satisfactory. As per the figures released by the Comptroller General of Accounts, gross tax collection up to December 2010 show a 27 per cent increase over the corresponding period of 2009-10, with Customs and Excise duties recording a growth of 66 and 37 per cent respectively, the Minister added. He said that this suggests that manufacturing activity is on a strong growth path, in spite of the monthly fluctuations in the Index of Industrial Production witnessed in recent months. The Finance Minister said that the total expenditure of the Government up to December 2010 has increased by 11 per cent over the corresponding period of the fiscal 2009-10, with plan expenditure recording a growth of 19 per cent as against a growth of only 8 per cent in non-plan expenditure. Shri Mukherjee said that both fiscal and revenue deficits are well below the levels recorded in the corresponding period of the last fiscal year. The Minister said while the current fiscal situation has been aided by the more than anticipated realisation in non-tax revenues, it has also afforded the opportunity to increase plan and other developmental spending in the course of the year. 

Economic growth projections reaffirmed with upward GDP revisions and improved fiscal indicators enabling policy flexibility. The Finance Minister affirmed that growth projections remain achievable, noting upward GDP revisions and a strong rebound in savings and investment in 2009-10. Improved fiscal indicators include higher gross tax collections with strong Customs and Excise growth, rising plan expenditure, and lower fiscal and revenue deficits compared with the prior year, aided by greater non tax revenue realisation that permits expanded developmental spending.