Finance minister Nirmala Sitharaman has ruled out any cutback in expenditure, allaying apprehensions sparked by hefty corporate tax rate cuts, and said the government would instead push spending as the country looks to stave off the economic slowdown that pulled down growth in the first quarter of this financial year to a six-year low.
The comments came two days after Sitharaman slashed base corporate tax rate to 22% from 30% for domestic companies and proposed a competitive 15% rate for new manufacturing units, offering a $1.45 lakh crore fiscal boost as part of a series of measures to revive growth. The surprise move had led to speculation that the government might resort to spending cuts to meet its budgeted fiscal deficit target of 3.3% of GDP for 2019-20.