Finance Minister Arun Jaitley while replying to a debate on the budget in the Rajya Sabha last night, as well as to demands for grants for various ministries, justifying the government's decision to further open up sectors like defence and insurance to FDI, said the country required a huge amount of resources to speed up development by perking up manufacturing that would lead to job-creation and poverty alleviation.

On FDI in defence, he said it is far better to have defence equipment manufactured inside the country with 51 per cent Indian ownership than importing 70 per cent of equipment from 100 per cent foreign-owned companies.

He said, the government has decided that 58 transport aircraft for Indian Air Force would be manufactured by Indian companies with foreign collaboration.

The Government has said the low tax regime envisaged in the budget is aimed at boosting economic activity. It also suggested interest rates for sectors like housing would come down with moderation in inflation. Asserting that profit is not a bad word, the Finance Minister said unless there is a profit, there will be no taxes.

Referring to budget proposals, Mr Jaitley said the government will encourage people to buy their own houses instead of paying rent.