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Jakarta (ANTARA News) - The Indonesian Democratic Party of Struggle (PDIP) has expressed rejection if the country is to increase external loans to cover a deficit in the state budget.

"Therefore, PDIP rejects the deficit in the state budget amounting to Rp115.7 trillion and prefers to a balanced budget," Utut Adianto of the PDIP faction of the House of Representatives said at a plenary session of the House of Representatives (DPR) here on Tuesday.

He was reading his faction`s response to President Susilo Bambang Yudhoyono`s recent address on the 2011 draft state budget.

He said that a budget deficit would only harm the state because it should be covered with external loans whose repayment would deplete the state`s finance.

"PDIP rejects new external debts, project as well as program loans with certain interest rates," Utut said.

The House`s plenary session was held to listen to factions` overviews over the president`s 2011 draft state budget and financial notes he made on August 16, 2010.
He said that PDIP asked the government to orient the budget focus to the people`s interest.

Earlier the president in his address was of the view that deficit was still needed in the draft state budget because the government needed to provide fiscal stimulus in order to maintain economic resilience.

In the 2010 revised state budget the deficit was set at 2.1 percent or Rp133.7 trillion which was later revised to 1.5 percent or Rp95.1 trillion.

In the 2011 draft state budget the deficit was set at 1.7 percent, or Rp115.7 trillion.(*)

Editor: Heru
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