FICCI URGES IMMEDIATE IMPLEMENTATION OF REFORMS SPELT OUT IN ECONOMIC SURVEY
NEW DELHI, February 28, 2008. The Economic Survey has clearly spelt out an action agenda for reforms in the current global and domestic economic environment. FICCI hopes that the Union Budget to be presented by the Finance Minister tomorrow contains sufficient triggers to enable the government to implement the new initiatives in right earnest, observed FICCI. The Survey’s emphasis on deregulating sugar, fertilizer and drugs sectors should also be an integral part of the reform agenda, said FICCI. The Survey sets out the overall direction of government policy for ensuring a noninflationary growth along with speeding up and sustaining growth at 9%. FICCI agrees that maintaining the growth rate at 9% will be a major challenge and pushing it to double-digit levels would be an even greater task in the context of the slowdown of the global economy and the threat of rising inflation within the country. FICCI also agrees with the Survey’s emphasis on reforms such as opening up the retail sector to FDI, hiking the FDI ceiling to 49% in insurance and selling up to 10% equity on Navratna PSUs. FICCI, however, does not agree with the survey’s suggestion that schemes should be streamlined to check SEZs proliferation. The chamber underlines the need for resumption of disinvestment of PSUs and wholeheartedly welcomes the new proposal for all allowing 100% FDI in new private rural agricultural banks which can cater to the credit needs of Indian agriculture. FICCI believes that giving a boost to the farm sector will be of critical importance not only for maintaining growth of GDP but also for price stability. The chamber has always emphasized the critical need for developing infrastructure, which has also been highlighted by the Economic Survey. In this context, FICCI particularly appreciates the Survey proposal to allow private sector entry into coal mining. The rising rupee that has affected India’s export growth also needs to be tackled urgently without any measures for capital control. FICCI welcomes the Survey emphasis on education and health for inclusive growth and hopes that the Union Budget will allocate adequate funds for giving a fillip to these sectors.
MEDIA DIVISION