Prime Minister Manmohan Singh on Saturday declared that government will soon announce steps to stave off investors' fears ensuing from measures like anti-tax avoidance rule and retrospective amendments and hinted at a fast track mechanism to speed up clearance of infrastructure projects.
Terming the recent decisions to reduce fuel subsidies to bring down fiscal deficit as "politically difficult" ones, he said "we bit the bullet and did what we felt was the right thing to do".
Speaking at the Economic Times function for award for corporate excellence, Singh said the government was mindful of the effects such steps have on the poor and vulnerable and "we will take all possible measures to protect their lifeline needs".
"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," he told captains of India Inc.
Admitting that certain tax measures like GAAR (general anti avoidance rules) and retrospective tax amendments in the Budget have led to "a very negative" reaction from investors, he said: "We hope to announce decisions on all these issues within the next few weeks".
Pointing out that the Cabinet has approved changes in the banking and insurance laws and also a new pension law, with higher FDI limits, the Prime Minister said: "It will be our endeavour to have them passed by Parliament as soon as possible. They will make our financial system more able to support growth."
Hinting at setting up of a National Investment Board (NIB), which has been mooted by Finance Minister P Chidambaram, the Prime Minister said one of the major negative features of the present situation was that a large number of infrastructure projects were stuck because of delay in granting various clearances and the non-transparency in determining the condition in which clearances are given.
"We are looking at ways to speed up clearance processes and making them more transparent," he said. MORE PTI TEAM CS
Planning Commission Deputy Chairman Montek Singh Ahluwalia expressed the hope that the Cabinet will take a call on the NIB in the next two-three weeks.
As regards the growth prospects for the current financial year, Singh said the Indian economy has been affected by the global slowdown and this has dampened the investor sentiment.
"Growth decelerated to 6.5 per cent last year and may be only around 6 per cent in the current year. This has dampened investor sentiment. Doubts are being raised in some quarters about the India growth story going astray..."
"But we can, and we must, correct our own weaknesses, and create new opportunities for economic growth and employment at home. This is the challenge before us," he added.
Referring to the recent government action to raise price of petroleum products and capping supply of subsidised cooking gas cylinders, Singh said the government is conscious of their effects on poor people.
"We will take all possible measures to protect their life line needs," he said.