PM hints at more steps to boost investor mood

Mumbai: Prime Minister Manmohan Singh on Saturday said the UPA government would soon announce further steps to boost confidence among investors who have been spooked by recent measures such as the anti-tax avoidance rules and retrospective tax amendments. 

    Admitting that measures like the general anti-avoidance rules (GAAR) and retrospective tax amendments in the Budget had led to negative reaction among foreign investors, he said, "We hope to announce decisions on all these issues within the next few weeks." He made the statement while addressing business leaders at the Economic Times Awards for Corporate Excellence in Mumbai. 
    The PM also hinted at decisions to speed up infrastructure projects, which face long delays on account of clearance bottlenecks, and promised corrective steps. Outlining the efforts of his government to push reforms, Singh said the UPA had bit the bullet and approved higher foreign direct investment in a host of sectors, including retail, aviation, insurance and pensions. 
    On banking and insurance, Singh said, "It will be our endeavour to get reforms measures passed by Parliament as soon as possible. They will enable our financial system support growth." 
WHAT PM SAID 
PM Manmohan Singh speaks at the Economic Times Awards for Corporate Excellence in Mumbai on Saturday 

• Will address general antiavoidance rules (GAAR) and retrospective tax issues 

•Will promote pooling of imported coal 

• Growth to be around 6% in the current year 

•FDI best option to reduce current account deficit 

•Will push infra projects stuck for want of clearances PM Manmohan flags iconic infra projects for Mumbai 
    Stressing on the need for infrastructure investments, Prime Minister Manmohan Singh said the government expected the private sector to contribute half of the $1 trillion required during the 12th five year plan. "Investment in infrastructure has to be in the vanguard of public investment for many years to come, and we are working in that direction. We have set ambitious targets for the infrastructure sector and ministries are being monitored regularly to see that they perform as expected," Singh said. 
    For Mumbai, the prime minister announced a host of 'iconic' infrastructure projects, including viability gap funding for the Mumbai transharbour link in the 12th 5-year plan and approval for the elevated rail corridor, besides a new airport in Navi Mumbai. It may be pointed out that he has in the past referred to his desire to transform Mumbai into Shanghai. He also said that some domestic airports would be elevated to the level of international airports. 
    In his welcome address, Vineet Jain, MD, Times Group, said some weeks ago, the government sprang into action with a spate of reforms and a cabinet reshuffle that sent out a clear signal that it meant business. "Against this backdrop, we felt it's a good time to ask the question: What next? Can the recent burst of reforms return us to high growth?" he said. 
    Praising Indian businessmen, the PM said they had transformed their businesses into world-class corporations with a high level of efficiency and had acquired companies abroad. "We welcome Indian companies developing footprint abroad even as we welcome foreign companies into India," Singh said. Accepting the fact that the Indian economy has been impacted by global developments, the prime minister said growth was expected to come down to the region of 6% for the year. "The Indian slowdown is also because of domestic constraints. Such downturns can have value if they make us focus on the weaknesses that are masked when times are good. We can and we must correct our own weaknesses. I assure you this will be the focus of our policy in the months ahead," he said, exhorting industry to drive harder. 
    Singh said the current account deficit had also widened because of a fall in exports. "It is difficult to reduce deficit in the short term because exports will not grow fast while efforts to raise the investment rate will lead to higher imports. Foreign direct investment is the best source to finance the deficit. It is more stable than other sources of funds and also brings in knowhow and access to global supply chain," he said. In the same vein, he added; "We have dispelled gloom and doom, improved the climate for foreign investment, improved ministry coordination and are working hard to restore investor confidence and the growth environment." 
    Speaking at the event, Ravi Dhariwal, CEO, Bennett, Coleman & Company Ltd, the publishers of The Times of India and The Economic Times, said the two main objections against the reforms had been that they were not inclusive and that they were "unpatriotic" as they encouraged foreign investment. "We have always argued that reforms are inclusive and they lead citizenry to a much better place. We urge all parties to come out openly in support of reforms," he said. 
    Earlier in the evening, the government's reforms agenda was reiterated by all members of a panel discussion which included cabinet ministers Anand Sharma and Kapil Sibal, deputy chairman of the Planning Commission Montek Singh Ahluwalia and Nandan Nilekani, chairman, Unique Identification Authority of India. The audience included top industry captains such as Mukesh Ambani, Anil Ambani, Sunil Mittal and Kumar Mangalam Birla.

Prime Minister Manmohan Singh, Times Group MD Vineet Jain (extreme left), commerce minister Anand Sharma (second from right) and Planning Commission deputy chairman Montek Singh Ahluwalia (extreme right) with the winners of the ET Awards For Corporate Excellence, in Mumbai on Saturday