Sunday, December 7, 2008
India Wants Economic Package
Responding to the economic slowdown affecting the country, the govt on Sunday unveiled a wide ranging stimulus package aimed at bringing down prices and providing relief to sectors hardest hit by the global financial crisis.
The Government effected an across-the-board 4 percent cut in CENVAT that will bring down prices of cars, cement, textiles and other goods as part of an economic stimulus package that also earmarks an additional Rs 20,000 crore for infrastructure, industry and export sectors.
In a virtual mini-budget that entails a revenue loss of Rs 8,700 crore in the next four months, the package seeks to revive the crucial housing, export, automobile, textiles and small and medium enterprises sector to counter the economic slow down caused by the global financial crisis and the recession in the West.
The much-awaited package, set rolling by Prime Minister Manmohan Singh who is also the Finance Minister, targets power, exports, housing, auto, small and medium industries and infrastructure sectors through additional funding and guarantees that total an amount of over Rs 30,000 crore.
The economy will continue to need stimulus in 2009-2010 also and this can be achieved by ensuring a substantial increase in plan expenditure as part of the budget for next year," it added. The measures also included the government departments being allowed to seek replacement of government vehicles within the allowed budget, in relaxation of extant economy instructions.
The Government is keeping a close watch on the evolving economic situation and will not hesitate to take any additional steps that may be needed to counter recessionary trends and maintain the pace of economic activity," it added.