NEW DELHI, Jan. 9 (Xinhua) -- The Federation of Indian Chambers of Commerce and Industry (FICCI), India's top business chamber, has suggested the central government to consider relaxing the fiscal deficit target to support capital infusion in the economy to boost demand and trigger investments.

In a written statement, FICCI President Sangita Reddy said that the Union Budget for the Financial Year 2020-21 was to be announced soon and "we look forward to government continuing taking steps towards bridging the existing gaps and giving out positive signals to boost the sentiment, consumption and investments."

The Union Budget for the forthcoming financial year is scheduled to be announced on Feb. 1.

Apart from providing cheaper loans, more efforts must be made to increase incomes, especially in the rural areas. This can be achieved through an increase in the quantum of income support and expansion of the "Direct Benefit Transfer" scheme. Steps are also required to boost construction, infrastructure and exports, said the FICCI chief in the statement.

With advance Gross Domestic Product (GDP) estimates projecting a growth at 5 percent during Financial Year 2020, the government needs to look at measures to infuse capital in the economy in a systematic way, said the FICCI president.

"The GDP growth estimate for the current financial year of 5 percent is on expected lines. The growth during the first half of the year has been moderate and we hope to see some momentum in the latter part. In fact, there are nascent signs that point towards an improvement and we need to make sure that these find a more solid footing going ahead," she said.

She said the nature of the Indian economy was cyclical and when a potential recessionary cycle was foreseen, moves to induct more capital into the economy to reenergize it was more important than worrying about fiscal deficit.

"A time-bound plan must be put in place on the mechanics to repair fiscal deficit through different measures, including disinvestment in public sector units (PSUs)," she added. Enditem

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