A two-day meet of the Task Force of the Organization for Economic Co-operation and Development (OECD) was inaugurated by Mr Vinod Rai, the CAG here today. Welcoming the delegates, Mr Rai hoped that the meeting would help in experience sharing for better targeting of aid, resource mobilization, sustainable debt management and ensuring desired outcomes of public expenditure.

The CAG said that external aid in the form of grants is no longer a major contributor to India’s development. Given its resource constraints, India has to rely extensively on borrowing to balance the budget and around 10 per cent of our borrowed funds come from external sources. Multilateral agencies contribute around 16 per cent of our external debt while bi-lateral agencies contribute around 9 per cent, he said. Only a small portion of this debt – around 17 per cent is on concessional terms and the rest is borrowed at market rates. We are, therefore, very concerned that borrowed funds are used optimally and the desired results are achieved in a tangible and timely manner, he added.

Mr Rai informed the delegates that the Indian Government has brought about significant changes in Public Finance Management in recent years. These include move towards a uniform Goods and Service Tax, forthcoming new Direct Taxes Code, FRBM, guidelines on cash management, preparation of detailed project reports, introduction of Outcome budget and Unique Identification programme. Further, the recent initiative to ensure the formulation of a Results Framework Document is also expected to bring about considerable improvement in performance measurement of individual departments, he added. Other important system setting measures which have a direct bearing on Public Financial Management are the appointment of a Task Force to strengthen internal audit in implementing departments and a phased move towards accrual accounting, Mr Rai said.

About 80 delegates from different parts of the country and representatives of World Bank, ADB, IDA and Ministry of Finance are participating in the Task Force Meeting hosted by the Comptroller and Auditor General of India.