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Will resolve problems, govt assures industry

August 02, 2011 08:52 IST

Finance Minister Pranab Mukherjee on Monday asked India Inc to send him a list of its concerns over government policies in four weeks and promised to address them in a time-bound manner.

Along with Commerce and Industry Minister Anand Sharma, he interacted with captains of industry, including Ratan Tata, Anil Ambani, Anand Mahindra, YC Deveshwar, NR Narayana Murthy, GM Rao, RP Goenka, Shashi Ruia, GVK Reddy, Sunil Mittal and others.

The meeting was held in the backdrop of apprehensions over moderating economic growth and charges of a policy paralysis.

The nearly three-hour meeting saw industry bigwigs raise issues related to high interest rates, cumbersome external commercial borrowing norms, infrastructure problems, etc. They suggested the government do away with the current limit of allowing only $500 million of external commercial borrowing by a company.

Some of them asked the government to allow more infrastructure companies engaged in large public-private-partnership (PPP) projects to issue tax-free bonds for retail investors. Some sought the privatisation of all airports.

At the end of the meeting, the industry captains seemed satisfied, as they talked confidently about government and business working in close cooperation.

"Each one of us will send around five suggestions that are most important for our sectors," Infosys founder NR Narayana Murthy told reporters.

Mahindra group vice-chairman and managing director Anand Mahindra said the Finance Minister asked the industry to send their proposals in four weeks.

"The finance minister will coordinate government responses in a stipulated period. The entire exercise will be completed in 60 days. The government and the industry will continue to have regular interactions," Anand Sharma said.

Though he admitted that signs of a slowdown in economic growth witnessed in the last quarter of the previous financial year

has spilled over to the current year, the Finance Minister exuded confidence that the fundamentals of the economy remained strong. The growth drivers in the medium term were broadly intact, he said.

"We are confident that collectively the government and the industry will overcome the problems... to reach high growth trajectory. We are one of the fastest growing economies in the world and we will continue that journey," Mukherjee told reporters after the meeting.

"Weakening of the business sentiment is partly due to an uncertain global environment and perhaps also on account of the rising cost of domestic credit," he said. He said a tight monetary policy had been necessitated by the continuing challenge posed by inflation. Inflation was 9.44 per cent in June.

"There has been some cynicism expressed of late regarding the lack of adequate movement on policies and institutional processes. I find this view to be based more on perception than facts," he said.

Upbeat after the meeting, Mahindra said, "If there was a trust deficit, it was dispelled on Monday. It vanished on Monday."

ADAG chairman Anil Ambani said the interaction would go a long way in building the momentum needed to catalyse economic growth. RPG group chairman RP Goenka said, "We have cooperation with each other. In the meeting, it was enquired whether  there was any problem with the industry."

The finance minister said the national manufacturing policy was being finalised and an enabling framework for an infrastructure debt fund would be notified soon.

A group of ministers would discuss this week the BK Chaturvedi panel report on coal mining and the committee of secretaries was at an advanced stage of examining the Vinod Dhall panel recommendations on public procurement and the Ashok Chawla panel report on the allocation and pricing of natural resources, he said.

He said some of the financial sector reform bills introduced in the last session of Parliament were expected to be passed in the current Monsoon session.

BS Reporter in New Delhi