Singh promises more reforms soon.
By R. Chandrasekaran
CHENNAI: The Indian Prime Minister Dr. Manmohan Singh has assured the captains of industry that his government will announce more reforms during the next few months. He was responding to the industry bodies’ complaints and ideas to bump up investors’ sentiment.
During the meeting of the prime minister with the trade and industry, Singh also raised the issue of hiking duties on some luxury consumer items besides seeking the opinion on floating a sovereign or non-resident Indian bond. Interestingly, the government had hiked customs duty to 8 percent for gold import from 4 percent, 100 percent from 75 percent on high-end motor vehicles and to 75 percent from 60 percent on motor cycles with engine capacity of minimum 800 cc.
The business leaders from different sectors have called for bold and brave steps as they pointed out that they believe in India’s growth story. They have also voiced concern over issues relating to tax disputes and transfer pricing as they affect investors’ sentiments. They have also pointed out that investors were not optimistic and that current pessimism was the resultant of regulatory bottlenecks. The captains demanded the government to ensure that these are removed quickly.
The recent weakness in Indian rupee has further sent alarm bells to policy makers on the current account deficit (CAD) front and the prime minister has reportedly advised the industry to reduce oil, coal and gold imports. The IT industry took advantage of the meeting and urged Singh to raise the visa issue with the U.S. authorities to help offset trade deficit at least partly.
The trade and industry was represented among others by Mukesh Ambani, Reliance Industries chairman, Sunil Mittal, Bharti Group’s chief, Deepak Parekh, HDFC chairman, Rahul Bajaj from Bajaj Group, N.R. Narayanamurthy and Azhim Premji from Infosys and Wipro, respectively, Chanda Kochhar, CEO of ICICI Bank, FICCI president Naina Lal Kidwai, and Rana Kapoor from Yes Bank.
The meeting centered on topics of industrial slow down, weak rupee and the resultant impact on trade and industry, CAD, industrial corridors development and skill developments.
A statement from the PMO said that the overall sentiment was for converting decisions into actions and brings back the mood to take India back to 8 percent or more growth pace. The statement added, “The Prime Minister wanted a report to be submitted within one month on what can be done in the next 2-3 months.”
The industry also gave its wish list such as removal of bottlenecks in pharma sector, device mechanisms to offer moratorium for repayment of loans on delayed projects, boost local electronic manufacturers and allow the usage of public sector units’ lands for creating industrial parks.