Concerned over the slow down, finance minister Pranab Mukherjee on Tuesday said political parties should demonstrate that Parliament and other institutions function so that confidence will return in the economy.
Against the backdrop of negative growth revealed by the industrial production figures, he said the economy has the capacity and resilience to overcome the crisis.
Blaming the weakness in the global economy for the recent slowdown in India's industrial output and economic growth, Pranab Mukherjee said that the government was not suffering from any policy paralysis and the Indian economy has the resilience to overcome the crisis.
"Questions have been raised: Have we entered into recession, have we entered into a phase where the economy is going to be derailed, have we entered into a situation where we cannot improve the situation and move ahead," Mukherjee said in the Rajya Sabha.
These perceptions were not true and the Indian economy has the capacity and resilience to over the crisis, the finance minister asserted.
"If you look at the performance of the economy, particularly in the crisis situation, you will notice that India workers, Indian farmers, Indian entrepreneurs have the capacity and resilience to overcome the crisis," he said.
Mukherjee said the government was not suffering from any policy paralysis and was capable of taking important decisions.
"The perception that there is paralysis in the decision making process, government does not function, it is not true," Mukherjee said in the upper house of parliament.
Mukherjee pointed out that in the last few months the government had taken decisions on several important issues, including on national manufacturing policy and allowing foreign direct investments in retail aimed to boost economic growth.
Replying to a discussion in the Rajya Sabha on the Appropriation Bill, he said the government will make efforts to build broad consensus on reforms as the economy has resilience to overcome the problem.
Expressing disappointment over frequent disruptions in Parliament, the Finance Minister said that for the economy to recover, it has to be demonstrated that Parliament and other institutions can function without disturbance.
"Let us not institutionalise instability in Parliament", he said, adding coalition governments have become stable since 2000.
Against the backdrop of difficult economic situation, he said political parties have to demonstrate that Parliament and other institutions function and it will have its impact on the government and confidence will return in the economy.
On its part, Mukherjee said, "The government will not be found lacking in building consensus on broad economic policies."
Denying a perception that there is paralysis in decision making process, he said, "It is not so."
The government, the Finance Minister said, has taken a number of decisions which include national manufacturing policy, incentives to small industries and package to debt-ridden handloom weavers.
As many as 73,000 villages will be brought into banking network with the help of technology by March 31, Mukherjee said, adding "actions are being taken... sometimes there may be some set backs... Running coalition is not an easy job."
The Minister also said that the Congress party has limited mandate making it imperative that consensus building was required.
He said questions have been raised whether the economy is going to be derailed in the wake of IIP figures turning negative and overall growth slowing.
"We have the capacity and resilience to overcome the crisis," he said.
The industrial production recorded a negative growth of 5.1 per cent in October, while the rupee crossed all time low of Rs 53 to a dollar.
The House later returned the Bill, granting Parliamentary approval for extra expenditure of Rs 63,180 crore for the current fiscal.
(With inputs from PTI, IANS)