The state Government Shall:
(a) take appropriate measure to eliminate the revenue deficit by 2008-09 and thereafter build up adequate revenue surplus and contain the fiscal deficit at three percent of Gross State Domestic Product from 2008-09 onwards, and utilize such surplus for discharging the liabilities in excess of the assets or for funding capital expenditure;
(b) pursue policies to raise non-tax revenue with due regard to cost recovery and equity;
and
(c) lay down norms for prioritisation of capital expenditure, and pursue expenditure policies that would provide impetus for economic growth, poverty reduction and improvement in human welfare.
4. Fiscal Management Principles - The state Government shall be guided by the following fiscal management principles, namely:
(a) transparency : There should be transparency in setting the fiscal policy objectives, the implementation of public policy and the publication of fiscal information so as to enable the public to scrutinise the conduct of fiscal policy and the state of public finances;
(b) stability and predictability : The fiscal policy making process and the way fiscal policy impacts the economy should be stable and should be such that its trend in the future may be predicted;
(c) responsibility and integrity : There Should be responsibility in the management of public finances, including integrity in budget formulation;
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(d) fairness : There should be fairness to ensure that policy decision of the State Government have due regard to their financial implications on future generations; and
(e) efficiency : There should be efficiency in the design and implementation of the fiscal policy and in managing the assets and liabilities of the public sector.