MUMBAI, India (AP) - India's new government introduced a reform-minded budget on Thursday focusing on promoting manufacturing and infrastructure, expanding the tax base and overhauling populist subsidies.
MUMBAI, India (AP) — India's new government introduced a reform-minded budget on Thursday focusing on promoting manufacturing and infrastructure, expanding the tax base and overhauling populist subsidies.
The budget for the fiscal year ending March 2015 is being closely watched as an indicator of whether Prime Minister Narendra Modi's government will act quickly to will deliver on promises to revive stalled economic growth.
Finance Minister Arun Jaitley outlined the broad strokes of the plan, which he said would be a departure from the "mere populism and wasteful expenditure" that has dragged down Asia's third-largest economy.
He said he would keep the government's budget deficit at 4.1 percent of gross domestic product this fiscal year. He said early on in his speech the government would overhaul subsidies to be "more targeted" but gave no details.
He also announced raising the limits on foreign investment in the defense and insurance industries to 49 percent from 26 percent.
"The people of India have decidedly voted for change," Jaitley said in opening his speech to parliament. Modi's Hindu nationalist Bharatiya Janata Party swept to power in May after the most decisive election victory India has witnessed in three decades, ousting the long-dominant Congress party.
Voters were fed up with Congress' failure to curb runaway inflation and the wilting of growth rates to below 5 percent in the past two years, far below the average of 8 percent of the previous decade.