CII Communique - February, 2010

economy
cover story
Pre-Budget Recommendations
Sustaining
Inclusive
Growth
CII, in its Pre-budget Memorandum 2010-11 to the Ministry
of Finance, has made recommendations to address the
challenges of sustaining and even accelerating economic
recovery, while reigning in fiscal deficit, towards
double-digit inclusive growth in GDP
The Union Budget 2010-11 is being presented
amidst the situation of the economy emerging
out of the financial meltdown. Having hit the
bottom of slowdown around the first half of
the last year, the economy has begun its
journey back to normalcy. Economic growth, industrial
production, exports, imports, employment, etc, have all
begun to reflect some assuring signs of recovery. Now,
the pertinent question is: have we left the worst of the
financial crisis behind us? The answer is: no. It may
be a bit early to say that we are out of the woods, as
the risk of double-digit recession is still not fully ruled
out. Any slip on policy at this juncture could reverse
the trend of recovery. It is this risk which has made the
job of managing recovery as challenging (if not more)
as fighting the crisis was.
The Budget 2010-11 will have to address the challenge
of sustaining and even accelerating economic recovery.
While doing so, it will simultaneously have to look at
reigning in fiscal deficit, which has ballooned to an
unsustainably high level. Besides this, it would also be
expected to keep in focus the medium to long term
objective of propelling industrial growth to the next level,
which is considered necessary to achieve double-digit
inclusive growth in GDP.
CII, in its Pre-budget Memorandum 2010-11, submitted
to the Ministry of Finance, has made recommendations
keeping in view these broad challenges. Some of the
key recommendations made in the memorandum are
summarized here.
6 | February 2010 Communiqué