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RBI's Budget assessment `largely favourable': Chidambaram

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The Finance Minister, Mr P. Chidambaram, with the RBI Governor, Dr Y.V. Reddy, the Finance Secretary, Mr D. C. Gupta, and Mr Ratan Tata, at a post-Budget meeting with the Central Board of Directors of the RBI in the Capital on Friday. _ Kamal Narang

New Delhi , July 16

THE Finance Minister, Mr P. Chidambaram, on Friday said the Reserve Bank of India's assessment of the Union Budget for 2004-05 was "largely favourable." Speaking to reporters after the customary post-Budget meeting with the RBI Central Board, Mr Chidambaram said RBI Board members had pointed out certain areas that needed to be looked afresh. However, he declined to comment on details of the discussions.

"The RBI Board members shared with me their perceptions. RBI's internal assessment of the Budget is largely favourable. The members have pointed out a few issues that needed greater clarity," Mr Chidambaram said.

He said though working closely with the central bank, the Government gives due respect to its autonomy. "The Government works with RBI closely while respecting its sphere of activity," the Finance Minister said.

An RBI press release on the meeting later said the Finance Minister emphasised on the need to strengthen the delivery systems. Stating the investment was the key to both agricultural and industrial growth, Mr Chidambaram said his maiden Budget under the United Progressive Alliance Government reflected the understanding that the agriculture sector and the rural India must be given much greater attention in the reform process.

Speaking at the meeting, the Governor, RBI, Dr Y.V. Reddy, said the stress on fiscal responsibility would contribute to the growing strength of the economy. He also said that the priority given to agriculture is essential for accelerating overall growth of the economy.

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