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Union Finance minister Pranab Mukherjee on Friday hinted the government will be forced to take “unpopular” austerity measures to stem the downward trend in the economy, two days after announcing in Parliament that the country will have to tighten its belt. The measures include a ban on the purchase of new vehicles by the government departments, curb on overseas trips by government officials and meetings in five-star hotels. Mukherjee reiterated his proposal that subsidy expenditure should be brought down specifically to 1.75 per cent of the GDP in the next three years. Earlier on Wednesday, the government had announced that it would resort to "unpopular" austerity measures to deal with fiscal problems but made it clear that it is not pressing "panic button". Mukherjee had told the Rajya Sabha that the government needed to deal with difficult situation in wake of the rising oil prices in international market and said efforts would be made to push growth which declined to 6.9 per cent in last fiscal.

Pranab hints at curbs on foreign trips, new vehicles