Would it be easy to reverse tax concessions given to petroleum products and excise duty?
The whole issue of decontrol is there. The new government should address it. There should be a rational tax system. One of the things we recommended as part of the B K Chaturvedi report was to make things transparent, separate taxes from basic price. In many cases, state governments levy huge taxes which are higher than what the centre levies. All these reform issues need to be addressed and are essential for long-term growth. Do you think sovereign ratings would be impacted because of higher fiscal deficit and high market borrowing (The interview was done before S&P reviewed its outlook for India’s sovereign rating)? It’s exactly the same question rating agencies ask. My counter question is: are you downgrading other countries, are you downrating the US, Japan? Everybody recognises that you’re operating below the trend and it’s not inappropriate to raise fiscal deficit, including debt rating agencies. The question they ask is, will you have the will to go back to the proper fiscal thi
