"The instructions have been issued as part of austerity measures and rationalisation of government expenditure to ensure fiscal discipline without affecting the efficiency of the ministries and departments," official sources told PTI.

The efforts are aimed at containing fiscal deficit at 3.3 per cent of the total GDP. Only last week, Finance Minister P Chidambaram had said that fiscal deficit would be contained and revenue deficit may be wiped out by 2008-09 as per the targets fixed by the government by taking various measures.

The fiscal deficit has touched Rs 1,03,0000 crore (Rs 10300 billion) during April-August period, which is 68.5 per cent of the targeted fiscal deficit for the current financial year.

Sources said the department of expenditure has recently written a letter to all the ministries asking them to cut at least five per cent non-plan expenditure during the current year and make efforts to bring down expenditure to the minimum essential level in the areas of maintenance of buildings, official equipment, furniture, communication and hospitality.

The sources said the expenditure department has also put a blanket ban on purchase of new vehicles and recruitment of drivers, except for the armed forces and para-military forces.

The ministry has also said that the ban on recruitment in government services imposed in May 2001 would continue, and "no post would be revived that have remained vacant for more than a year."