The government will soon announce several reforms measures to boost growth and revive investor sentiment. Finance minister P Chidambaram on Thursday said the government would shortly review FDI caps in several sectors and decide on gas and coal prices.
“I am looking forward to more reforms... In June, you can expect a number of decisions to be taken and implemented that will accelerate reforms and spur investments in critical sectors,” he said.
This is of critical importance as the Indian economy slowed to a 10-year-low growth rate of 5% in 2012-13. The growth rate has remained sluggish so far this financial year. An economic revival will lead to more jobs, better increments and larger spends.Chidambaram added that he would soon meet the chiefs of public sector banks to press upon them to reduce lending rates. While RBI has reduced policy rates by 1.3% since January 2012, banks have cut lending rates by only 0.30%. Thus, there is room for further cuts in lending rates.
The minister also spoke about fast-tracking stalled projects. By evening, Prime Minister Manmohan Singh directed the setting up of a special group
to fast-track the R7 lakh crore projects that are stuck because of red tape or lack of clearances. The group will clear up to 40 such projects by next month.
This is expected to kick start the economy and set in motion a virtuous circle that generates more jobs, greater spending by consumers and higher growth.
Chidambaram added that the government would take all steps to ensure the fiscal deficit target of 4.8% for 2013-14 is achieved.
Referring to the Fitch upgrade, he said it showed the government was on the right track.