Prime Minister's reservations hold back Kelkar Committee report on government finances

The Kelkar Committee panel report on the roadmap for government finances may not be made public anytime soon. NDTV Profit learns that Prime Minister Manmohan Singh has “reservations” on select recommendations of the report. Finance Minister P. Chidambaram has refrained from making the report public, as had been planned earlier. Finance ministry officials declined to elaborate on the “reservations”. In response to a question from NDTV Profit on 17 September, Mr Chidambaram had said, “The Kelkar report will be uploaded by the end of the week. There will be marginal slippage in the fiscal deficit target.” The report has recommended a stringent fiscal consolidation roadmap for the government, with subsidy targets, the future course of action on administered prices of petroleum products and fiscal deficit targets. With the divestment receipts, the Kelkar report pegs the fiscal deficit at 5.9 per cent of the gross domestic product (GDP) for the current fiscal against the Budget estimate of 5.1 per cent. The Finance Minister has indicated a fiscal deficit estimate of 5.3 per cent for the current financial year, if the government is able to implement some suggestions of the Kelkar report, sources say. The government is trying to accelerate its disivestment programme to meet the budget estimate of Rs 30,000 crore (approximately $4.5 billion) for the current fiscal year. It has also partially addressed the issue by increasing diesel prices and capping the number of subsidised cooking gas cylinders. The Finance Minister is hoping to contain the subsidy bill at 2.4 per cent of the GDP, higher than the budget estimate of 2 per cent. In the current fiscal year ending March 2013, the government’s subsidy bill is expected to touch Rs 2.4 lakh crore (approximately $44 billion) against the budget estimate of Rs 1.9 lakh crore (approximately $35 billion). The government hopes to cut down the oil subsidy payout by Rs 20,000 crore ($3.8 billion) after the recent increase in diesel prices and capping of subsidised cooking gas cylinders. It may also go slow on its planned expenditure outlay, to save Rs 30,000 crore ($5.5 billion) in the current financial year.

Prime Minister's reservations hold back Kelkar Committee report on government finances

NDTV Profit

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