Finance Minister Pranab Mukherjee said the government will make an effort to bring down fiscal deficit and ensure its borrowing does not remain at a high level for a long time.
"The Prime Minister has spoken about fiscal consolidation, which is absolutely imperative. We have to do it," Mukherjee said in his address at the India Economic Summit organised by the World Economic Forum here.
In the Budget for 2009-10 (April-March), the government's fiscal deficit has been projected at 6.8% of the gross domestic product.
It aims to bring down the fiscal deficit to 4.0% in 2011-12. The government's gross borrowing in the current financial year is estimated at a record high of Rs 4.51 trillion.
"We had to borrow heavily, but we had to ensure the government borrowing does not elbow out private borrowers.
Three-fourth of our borrowing (for 2009-10) is over and private sector credit requirement has not been elbowed out," the minister said. Mukherjee expressed hope the Indian economy would grow 7.0% in the next fiscal, and at 8.0% in 2011-12.