The finance minister mentioned that second generation reforms proposed in the budget will seek to consolidate the gains of the first phase of reforms. He reiterated that the direction of reforms in the medium and long term have to be clearly defined through consensus.

Expressing optimism about the early revival of the economy, he said the response of the financial markets to the budget isheartening.

The budget and the monetary management of the economy by the RBI will give a strong growth impetus to the economy, he added.

In response to the finance minister's comments, RBI governor Bimal Jalan expressed appreciation of the Government's commitment to reduce fiscal and revenue deficits in the medium term. This would greatly facilitate the task of monetary management and would help the RBI in ensuring the strengthening of the balance of payments position, he said.

The directors of the board expressed full support of the measures in the budget and "expressed optimism about the revival and resurgence of the economy."

Speaking to newspersons after his address, Sinha said it is imperative that monetary policy and fiscal policy move in conjunction.

After the meeting, Jalan said "the economy is picking up."

Inflation is under control and that is a real consolation, he remarked. The details of the Gold Bond Scheme are being worked out and the central bank is presently holding discussionswith several banks on the details of the scheme, Jalan said. The RBI is keen that exporters get finance at internationally competitive rates, the central bank has taken initiatives in this direction and is determined to help exporters, he said.

The RBI wants to extend full support to the small scale sector and ensure that the SSI sector gets finance at internationally competitive rates, Jalan said.

The post-budget meeting was attended by minister of state for finance, KMR Janarthanan, finance secretary VK Kelkar, revenue secretary JA Chaudhary, expenditure secretary EAS Sarma, special secretary (banking) CM Vasudev, chief economic adviser SA Acharya and depputy governors SP Talwar, YV Reddy and Jagdish Kapoor. Board members who were present were PN Dhar, YH Malegam, EA Reddy, Mumtaz Ahmad, CH Hanumantha Rao, Bhai Mohan Singh, ML Shahare, Amrita Patel, Vipin Malik and G Ramachandran.