ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846
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National Income-Credibility Gap

export prospects, particularly in regard to sugar, the overall payments position is unlikely to he easier next year. So with inflation still of menacing proportions and the external payments position exceedingly precarious, the 1975-76 Budget, if it has to be relevant, most rely on measures aimed seriously at containing the overall pressure of domestic demand, while simultaneously affording greater economic protection to the vulnerable sections of the community, and raising investment in transport, power and selected industries so as to safeguard the long-term growth of the economy. What, then, are the options open to the Finance Minister? No one really believes that the recurrent expenditures of the government can be contained at the levels already reached, not to speak of reducing them. So if the Finance Minister sets out to curtail government spending, the axe will ultimately fall on investment or the plan outlay. But should he? Should he not instead aim at much higher revenues in order to achieve an overall fiscal balance? True, in 1974-75, the Central government did ultimately introduce measures which, in a lull year, would yield something like Rs 1,000 crows additionally. But that is not reason enough for going slow in resource raising in the coming year.

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