Finance Minister Nirmala Sitharaman on Sunday asserted that there will not be any compromise with respect to the country's fiscal deficit. Sitharaman said the FRBM (Fiscal Responsibility and Budget Management) Act has been kept in view and has been abided by while preparing the Budget 2021.
FRBM is an Act of the Parliament which intends to bring transparency and accountability in the conduct of the fiscal and monetary actions of the government. It targets phased reduction of fiscal deficit.
Sitharaman in her Budget speech proposed reducing fiscal deficit by 30 basis points to 3.5 per cent of GDP in 2020-21. She invoked the escape clause to take a 50 basis points leeway for FY20, taking the revised estimate to 3.8 per cent of the GDP.
Interacting with trade and industry representatives in Hyderabad on the second leg of her 'Jan Jan Ka Budget 2020-21', the Finance Minister said the interests of all sections of people from all sectors have been kept in mind while preparing the Budget.
Commenting on issues raised by trade and industry representatives, the minister assured that the government is giving a lot of attention to the MSME (Micro, Small and Medium Enterprise) sector. Sitharaman, in her second Budget speech, announced a slew of measures to spur MSME sector's growth. The Budget proposed for the MSME Ministry stood at an all-time high of Rs 7,572 crore - a rise of 8 per cent from the FY20 figures of Rs 7,011.29 crore.
Over a suggestion to modify Dividend Distribution Tax (DDT) to long term foreign investors, especially investors of infrastructure projects, Sitharaman said the foreign investors are not asking any DDT modifications as that will come under the respective treaties between countries.
By Chitranjan Kumar with agency inputs