Ashok Chawla, Secretary, Economic Affairs said that the government borrowing callender will be heavy in the next fiscal. Government may go with private placement of bonds with RBI in the next fiscal. Borrowing through MSS route is an option.
He said that the government will meet RBI later this month to firm up borrowing callender for ’09-10. Government expects the banks to cut interest rates in April after financial year-ending in March. Growth this year and next year should be close to 7%. He feels that S&P downgrade threat will not lead to flight of FIIs. About Indian Rupee, he said that the currency will find its own level.he further said that the fiscal deficit target will not be adhere to in ’09-10. Government will be back on track with fiscal consolidation from 2010-11. Economic recovery in India should be in Q3 and Q4 next fiscal. RBI’s rate cuts send clear signals to banks about lower interest rates. There is no proposal to reduce domestic fuel prices as of now. Auction process of 3G will take place next fiscal, he informed.
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