PM promises more reforms, says eco can grow at 8 pc

New Delhi, April 4: Giving a pep talk to boost investor confidence, PM Manmohan Singh promised further liberalisation of FDI regime and push ahead land reform measures expressing confidence that the eco can return to 8 pc growth with decisive govt action.

Addressing the business and corporate leaders in New Delhi on Wednesday, he termed the business mood in the country as unduly pessimistic and that the economy was facing only a temporary downturn.

Expressing commitment to continue with reforms, the Prime Minister said, "The liberalisation of FDI in multi-brand retail, civil aviation and other areas, are important signals. We are reviewing the FDI policy comprehensively to see what more can be done in the coming months.

The private sector, the Prime Minister said, needs an environment in which enterprise can flourish and create both jobs and stimulate growth to ensure that it remains inclusive.

"The environment today is not what it should be, and that is what the Government must correct," Singh said adding that more reforms are being considered by the government.

Attributing the growth rate slipping to decade low of 5 percent to global slowdown, he said domestic constraints "must be removed if the economy is to perform at full potential."

Addressing the CII AGM after a seven year gap, Singh said: "If the business mood was unduly optimistic in 2007, I think it is unduly pessimistic today. This needs correction."

The growth has slowed to 5 percent which is clearly disappointing, the Prime Minister said, adding that this is not a permanent reduction in the longer term growth potential.

"I do not believe our future is 5 per cent growth. We grew at an average of about 8 per cent in the last ten years and we can get there again. But this calls for speedy and decisive government action," Singh said.

The country has to cope with weak exports and higher Current Account Deficit (CAD), which is due to global factors, he said adding the CAD will be around 5 percent of GDP in 2012-13.

"We cannot do much about the global slowdown. We can only wait for the world to get back to more normal conditions ... But we can act forcefully to deal with the many domestic constraints that have arisen...".

Observing that the high fiscal deficit is unacceptable, Singh said: "We are determined to do everything possible to achieve the fiscal deficit target".

As per the road map, the government aims to bring down the fiscal deficit to 3 percent of GDP by 2016-17.

"I would urge Indian industry to have faith in our determination and avoid getting swamped by negativism," he said.

He also said managing coalition is not easy but added that the problems have not arisen suddenly.

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Courtesy:ISTV Imphal


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