The Finance Ministry on Thursday ordered small-bore austerity measures including a ban on holding meetings at five-star hotels and first class air travel as it tries to trim the fiscal deficit to a seven-year low.
These measures also include a ban on creation of new posts in government. "Such measures are intended at promoting fiscal discipline, without restricting the operational efficiency of the government," a Finance Ministry statement said.
The austerity measures will include a 10 per cent cut in non-plan, or discretionary, expenditure. Interest and debt payments, the defence budget, salaries and pensions will not be affected, the statement said.
The Narendra Modi government has set a challenging fiscal deficit target at Rs 5.31 lakh crore, or 4.1 per cent of the GDP (gross domestic product) for the current fiscal year.
India's fiscal deficit touched nearly 75 per cent of the full-year target, or Rs 3.97 lakh crore, in just the first five months of the fiscal year (April-August).
The fiscal deficit - gap between government expenditure and revenue - was pegged at 4.5 per cent of GDP in 2013-14.
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