India to curb official foreign trips in austerity push

By AFP
Published: May 19, 2012

India says it is 'vigorously' committed to curtailing ballooning spending.

NEW DEHLI: India has outlined plans to curb government foreign trips as part of an austerity drive and says it is “vigorously” committed to curtailing ballooning spending.

The statement late Friday came as India’s currency slumped to a new record low against the dollar with investor risk-aversion amplifying pressure on the rupee, already hit by worries about a slowing domestic economy.

“The government is committed to carry on the process of fiscal consolidation vigorously,” junior finance minister Namo Narain Meena told parliament in a written statement.

Finance Minister Pranab Mukherjee said earlier in the week he would introduce “austerity measures” to “convey a signal we are responding to the situation.”

Along with the travel restrictions, the government also aims to ban purchases of new cars, except by the military, clamp down on holding conferences at five-star hotels and impose “strict discipline” on hiring consultants.

Other measures are expected to be announced later, government officials said.

The finance minister has ascribed many of India’s economic problems to the crisis in the eurozone which has hit exports and prompted foreign investors to pile out of India into the perceived safe haven of US assets.

But the government has also come under attack for its management of the economy with business confidence hit by the sluggish economy, controversial tax rulings, economic reform paralysis and worries over rising welfare subsidies.

India’s growth fell to 6.9% in 2011-2012 from 8.4% the previous year with the unruly coalition government unable to agree on steps to further open up the economy to spur expansion.

Even as the government announced the austerity plans, Civil Aviation Minister Ajit Singh invited journalists to travel with government officials to the United States to take delivery of state-run Air India’s new long-range Boeing jets.

The government’s emailed invitation said “travel, accommodation, etc., will be taken care of by us,” drawing mocking newspaper headlines.

“Austerity be damned: Bleeding Air India flies journalists to lavish US trip,” said the Daily Bhaskar.

Money-losing Air India, known as the “Maharaja of the Skies” for its turbaned cartoon mascot, is in the grips of a crippling pilots’ strike and is an estimated $10 billion in debt.

Reader Comments (7)

  • jack
    May 19, 2012 - 2:24PM

    Eurozone crisis has effected whole asia especially india and china…but we will comeback strong…

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  • Parvez
    May 19, 2012 - 3:02PM

    It should not be a paper exercise like we see in Pakistan.Recommend

  • Prasad Babu
    May 19, 2012 - 3:47PM

    This got to be a lesson to all. Indian PM Manmohan Singh is an economist and may be a good one at it. He is not corrupt and may be a better person than most Indian politicians.

    But he is neither a good administrator nor a praiseworthy leader. Without a brilliant administrator like the then PM Narasimha Rao to support Manmohan Singh, India would not have come out of the financial mess in early 90s.

    The lesson is just because a guy is good and smart does not mean he will make a good leader. Comparatively crafty Zardari may be a better manager/leader than “Mr.Nice Guy” Manmohan Singh. Many Pakistanis may not want to admit for political reasons but Zardari did save Pakistan’s behind in the latest stand-off with the US. Give the credit where it is due!

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  • Sunny
    May 19, 2012 - 4:01PM

    tough time for congress to win next elections, in last four years india has been the centre of corruption scandals and lower growth rate means rising unemployment in the nation of 120 crores.

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  • let there be peace
    May 19, 2012 - 10:34PM

    I agree with @Prasad Babu. In these crucial times India needed a people with vision and leadership qualities at top. Instead we have a government that is behaving like headless chicken. Last time we had a crisis, there was a great statesman like PV Narasimha rao in charge.
    .
    I’ve started liking that rupees symbol. Feels good to see it in foreign newspaper.

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  • Giri
    May 20, 2012 - 2:48AM

    I partly agree with @Prasad babu. Regarding PV Narasimha Rao, He was a great leader and visionary who helped India come out of the financial mess the country was in after decades of socialist policies of Nehru and Indira Gandhi. He started trend setting reforms when it was extremely difficult to come out the solcialist policies of that era. He was never given a due recognition for all his contribution, and his dead body was not even allowed to enter the congress headquarters due to orders from the high command Sonia Gandhi(so much for erasing the names of Congress leaders except that of their family’s).

    I don’t agree about Zardari being a great leader. He has allowed his country to go in such a deep mess and then helped little with some favours from USA, so what is so great. A great leader shouldn’t succumb to pressures from society. He had a great chance to neutralise any effort to prop up terrorist camps, but he didn’t take any stand.

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  • Hasan
    May 20, 2012 - 10:19AM

    Why don’t you guys launch a few more failed satellite missions instead? That’s help your 700,000,000 starving people.

    LOL, just another reason to feel relief for 1947.

    Hasan

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