Budget 2019: Economic advisory panel against deviating from fiscal consolidation; says social sector intervention essential

New Delhi: Days ahead of presentation of the interim budget, the Economic Advisory Council to the Prime Minister (EAC-PM) on Friday cautioned the government against deviating from its fiscal consolidation target.The council, however, observed that there must be a continued emphasis on social sector interventions."The council strongly feels that there should be no deviation from the fiscal consolidation target but there must be continued emphasis on social sector interventions", an official release said after a meeting of the EAC-PM on Friday.[caption id="attachment_4495585" align="alignleft" width="380"]

Representational image. Reuters.[/caption]The statement has come amid speculations that the government may announce packages for farmers and poor and sops for middle class in the budget ahead of general polls.Junior agriculture minister Parshottam Rupala said on Thursday that the government will soon announce a package for farmers to boost their income.Moody's Investors Service on Friday pointed out that steps announced by the government to aid MSMEs and the measures being planned to support farmers will increase the risk of fiscal slippage and push deficit to 3.4 percent of GDP in the current financial year.The government had budgeted the fiscal deficit for the current financial year at 3.3 percent of the gross domestic product (GDP). However, in the April-November period, the deficit touched 114.8 percent of the budget estimates.Railways Minister Piyush Goyal is likely to present the interim budget on 1 February as he was on Wednesday given the additional charge of finance ministry.The council said India's economic growth is expected to remain in the range 7-7.5 percent in the next few years.The panel noted that the macro-economic fundamentals of the economy are sound but challenges remain, several of which are structural in nature.Follow full coverage of Union Budget 2019-20 here  To keep watching India’s No. 1 English Business News Channel – CNBC-TV18, call your Cable or DTH Operator and ask for the Colors Family Pack (inclusive of 24 channels), available for Rs. 35/- per month, or subscribe to the channel for Rs. 4/- per day. To keep watching the Leader in Global Market & Business News – CNBC-TV18 Prime HD, call your Cable or DTH Operator and ask for the Colors Family HD Pack (inclusive of 25 channels), available for Rs. 50/- per month, or subscribe to the channel for Rs. 1/- per day.