Fiscal stimulus will be phased out in 2010: PM | business | Hindustan Times
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Fiscal stimulus will be phased out in 2010: PM

business Updated: Nov 09, 2009 00:56 IST

Prime Minister Manmohan Singh, walking the wedge between fiscal discipline and a push for high growth, on Sunday said the government would begin rolling back next year the stimulus measures introduced to counter a downturn, but also promised more economic reforms ahead.

Singh, who said the economy would grow by 6.5 per cent in 2009-10 despite a drought this year, signalled that reforms would push ahead in the financial sector, particularly in the politically contentious areas of pension and insurance.

Growth would accelerate to more than 7 per cent in 2010-11, he said, adding that the medium-term objective was to sustain a growth rate of 9 per cent.

“Like many countries, we resorted to stimulus and we will take action next year to wind this down,”Singh told the annual India Economic Summit.

“Some reforms needed especially in insurance involve legislative changes. We’ve taken initiatives and will strive to build the political consensus needed for these legislative actions to be completed,” he said.

“We need to improve the (commodities) futures markets for better price discovery and regulation. We need to remove institutional hurdles to facilitate better intermediation… We are better placed than anytime in the recent past to push the reform process forward.”