Prime minister promises more policy reforms for growth
Prime Minister Manmohan Singh Saturday promised to bring in more policy reforms to accelerate inclusive growth and lift the spirits of investors in the economy, addressing all concerns about the fiscal deficit, taxation, disinvestment and infrastructure.
Addressing captains of industry in the capital, the prime minister said his government has the "courage of conviction and the interest of people at heart" and taken some politically difficult decisions despite the naysayers and cynics trying to halt it in its tracks.
He said for over a year or two excessive pessimism has hurt the growth process.
"But I stand before you to reassure you that our government is committed to doing everything that is possible to alter the policy environment, to accelerate economic growth and to make the growth process socially and regionally more inclusive," said the prime minister.
He told the Annual General Meeting of industry association FICCI that the steps the government had taken recently were only the beginning of a process to revive the economy and take it back to its trend growth rate of 8 to 9 per cent.
"We need to complete the exercise that was begun on GAAR and taxation of the IT sector. The day before yesterday, the Cabinet has approved the constitution of a Cabinet Committee on Investment. This would help in the issue of clearances for major projects in a time bound manner.
"We will speed up the disinvestment process which will also revive our equity markets."
He also stressed the need to address the under pricing of electricity and petroleum products to cut down the subsidy bill.
"We are bringing greater clarity in the FDI policy in the pharma sector...The Direct Tax Code and the Goods and Services Tax Bills are high on our priority."
He said the decisions on foreign direct investment in multi-brand retail, civil aviation and broadcasting, and the bills on liberalising foreign investment limits in banking and insurance were based on sound economic logic to insulate the country from persistent global economic slowdown.
"I am afraid that those who oppose these moves are either ignorant of global realities or are constrained by outdated ideologies," he said, in an apparent reference parties from the Left, Right and Centre to reforms.
The prime minister was particularly emphatic about his government's social spending to broaden the base of development which he said widened the home market for business and was essential for the long-term stability of the Indian polity.
"Equitable growth can by itself generate more growth. A more educated and healthier workforce is more productive. better rural infrastructure integrated rural economy far more effectively into the the larger national economy.
"A healthy agricultural economy facilitates faster growth of industry. A more prosperous and better connected populace is a source of larger demand and market for goods and service."
The prime minister also said the time was ripe for a new "social compact" between business, government and society.
He asked the corporate sector to take up the responsibility to support rural and skill development, and affirmative action designed to provide employment to women, the under-privileged and the differently abled.