New Delhi, Jun 9 UNI | 1 month ago

The government is committed to evolving a model of national development which is driven by the States, and intends to extend necessary flexibility to them in order to achieve the goal.

This was stated here today by Union Finance Minister Arun Jaitley while having a pre-budget meeting with finance ministers of all States and Union Territories.

Mr Jaitley urged the States to be fiscally responsible with this greater devolution of power.

''Intergenerational equity must be kept in view while deciding today's spending. I appreciate the fact that most of States have been conforming to the FRBM targets. We must carry this forward,'' he said.

He said Union and the States must complement each other in managing the economy and the fiscal policy, adding economic growth can not be compromised at any cost.

The Indian economy had witnessed a growth of sub 5 per cent in the recent years.

On Goods and Services Taxes (GST), Mr Jaitley said consensus needs to be built and implementation done at an early date.

''Implementation of GST has the potential to significantly improve the growth story,'' he said.

Talking about long inflationary trends which have adversely impacted the food and nutritional security of the common man, Mr Jaitley said the government is committed to breaking this vicious cycle of high inflation and high interest rates.

''While, we look forward to your support in tackling temporary fluctuation in prices, we also would like to evolve a mechanism which addresses the structural issues that create supply bottlenecks,'' he said.

Inflation continued to be rising with April figure at 8.9 per cent.

While there is a National Food Security Act, Mr Jaitley said the need of the hour is to implement the law in a cost effective and efficient manner for ensuring real food security.

He added that PDS as a vehicle to shield the poor from price rise has to be significantly improved.

Tax collections are only at 10 per cent of the GDP compared to the initial budget estimates of 10.9 per cent.

(Posted on 10-06-2014)