He added that India would look to reduce subsidies, accelerate reforms and state asset sales and boost infrastructure spending.
The budget comes as the government’s popularity has slumped due to a number of scandals and policy failures.
There were concerns it may sacrifice fiscal prudence in order to win votes.
“I don’t see any populist schemes, but this not a reformist budget either,” said A Prasanna of ICICI Securities in Mumbai.
“It is a status quo budget. I think the political compulsions made them decide that the best way is to play it safe,” Reuters news agency quoted him as saying.
During the last three months of 2011, India’s economy grew at its slowest pace in three years.
Growth was 6.1% in the fiscal third quarter, though on Friday Mr Mukherjee explained that it was only a temporary slowdown.
He forecast that the economy would expand by 6.9% in the current fiscal year ending in March, with growth accelerating to 7.6% in the financial year running from 2012 to 2013.
“Though we have been able to limit the adverse impact of the slowdown in our economy, this year’s performance has been disappointing,” Mr Mukherjee said.
However, he explained that when compared to other nations “India still remains among the front-runners in economic growth”.