New Delhi (JPN/Bureau): Presenting budget at a time when the economy is reeling under the pressure of rising prices, political upheaval and sluggish industrial production, would be a challenging task for the Finance Minister.

To rein in inflation Finance Minister Pranab Mukherjee will have to take concrete steps to tighten the purse strings of the government, this becomes even more essential in view of the pressure being built up by the opposition to check the rising prices.

Finance Minister, however, has already attained some success in this regard. Statistics tell us that the revenue collection this year is much ahead of expectation. Government’s non-tax revenue collection on account of 3G spectrum auction was nearly Rs 19, 13120 crores, which is 30 per cent more than the yearly estimate.

Besides, even tax collection has attained its target of 73.2 per cent (Rs 3, 91,148). In the remaining three months of the financial year it is expected to cross its target as well. The strong position of the central treasury would also minimise the gap in state revenue collection to a great extent.

According to reports, this comfortable situation is not going to continue next year as there will not be the spectrum money again in the government coffers. Even disinvestment does not seem a very promising option. Crude and food prices can also be an issue of concern for the government.

In the year 2010-11, more than Rs 21,000 crores have been shelled out as subsidies to the oil companies.

This burden is going to continue next year too. In the same way the government will have to continue the food and agricultural subsidy too. In view of the upcoming elections in the states of West Bengal and Tamil Nadu the government is less likely to cut the subsidies.

Absence of private funds for infrastructural development has further worsened the situation. Amidst these looming troubles the government has no option but to find a way out to bail itself from the impending financial crisis.