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After big-ticket reforms, Prime Minister may announce spending cuts


For Prime Minister Manmohan Singh, the more difficult part is over. The most difficult part has yet to begin.
Dr Singh has won over industry with the big ticket reforms that the government announced on Thursday and Friday. However, implementing them in face of severe backlash from the Opposition and allies alike will be a Herculean task.

When the Prime Minister speaks at the Planning Commission today, everyone will be listening keenly. Dr Singh will chair a meeting of the Planning Commission to discuss India's five-year economic strategy and look at trimming expenditure in the light of an economic slowdown.

The government may announce spending cuts for the 2013 fiscal year today, although the size of the cuts is not clear, Reuters reported earlier, citing two government sources.

"The government is quite serious to keep the fiscal deficit as close to budgeted target of 5.1 per cent of GDP as possible," one of the sources, a senior finance ministry source, said.

A second source, a senior government official who did not want to be named, said the meeting would "discuss cuts for current spending".

Economic Affairs Secretary Arvind Mayaram told NDTV earlier that while the quantum of the likely cuts was not known, it would be done to curb wasteful expenditure only and that the government had no reservations about social spending.

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