RBI chief calls for more fiscal coordination by state and federal govts

[MUMBAI] India's central bank Governor Shaktikanta Das said on Tuesday it was important to co-ordinate fiscal consolidation and planned spending by the federal and regional governments.

"There is now general agreement in the country about the importance of fiscal consolidation roadmap both at national and state levels," Mr Das said in a speech at a book launch event.

"While adhering to fiscal deficit targets and debt to GDP ratios, it is equally important to undertake robust expenditure planning based on a commonly agreed expenditure code to address the socioeconomic challenges without diluting fiscal consolidation," he said.

Mr Das added that while a recent goods and services tax was a good example of "fiscal federalism", it was a challenge to increase tax collections as a percentage of the country's gross domestic product.

REUTERS