The government will soon announce import curbs on several non-essential items, a top finance ministry official said Wednesday while terming "the 10 percent depreciation" in the rupee in the last few weeks as a "temporary phenomenon.""There are always implications of the dollar and rupee exchange rates ... this 10 percent depreciation in last few weeks that is a temporary phenomenon," he said at an event organised by PHD Chamber of Commerce here.
To a question about when the government intends to impose import curb on non-essential goods, he replied, "very soon."
He, however, did not give any timeframe.
Last week, Finance Minister Arun Jaitley announced the government's decision to relax norms for raising overseas borrowing and impose restrictions on the non-essential imports as part of efforts to check rising current account deficit (CAD) and a falling rupee.
India's current account deficit deteriorated to 1.9 percent of GDP in 2017-18 from 0.6 percent in the previous year and is forecast to rise to around 2.8 per cent in the current year. The trade deficit expanded to $80.4 billion in the first five months of the current fiscal year from $67.3 billion in the year-earlier period.
The rupee has logged year-to-date losses of more than 13 percent against the strengthening US dollar after trade concerns and firming up crude oil prices. It has dropped close to 6 percent since August.
Garg exuded confidence that the fiscal deficit would be maintained as per the Budget announcement despite pressures.
"Come what may, oil situation, rupee or whatever the fiscal deficit will not be allowed to slip from 3.3 percent, or better as we go along. I think all the pain points, all the issues which were earlier thought of as something unknown, whether it's the MSP (minimum support price), all these have now been factored into," he said.On the price rise, Garg said, 4 percent inflation for a developing economy is healthy, it is not something unhealthy or detrimental for the economy.
The Economic Affairs Secretary also explained that since the dependence of 50 percent of India's populace is on agriculture, it needs a transition and therefore, required policy steps.
The government has announced various schemes including Ujjwala Yojana, health protection and rural electrification with the intention to bring change in rural India, he said.Besides, he said, the government has drawn up a programme for increasing the export of agri products from $30 billion to $100 billion.
"India's agri exports potential is as high as $100 billion against a current export of $30 billion. To realise this potential, export of agri commodities will be liberalised," Jaitley had said while presenting the Union Budget 2018-19.