FM to India Inc: Govt going full steam on reforms.

After announcing a slew of measures since taking over charge, finance minister P Chidambaram on Wednesday assured India Inc that the government would continue with its focus on economic reforms and hoped that pending bills for hiking foreign direct investment in the insurance sector will be enacted in the upcoming Winter Session of Parliament.

“The finance minister would like to see the key economic reforms happen and is looking for all us to work together,” said Naina Lal Kidwai, HSBC India Country Head and senior vice president, Ficci. Chidambaram had invited industry chambers CII, Ficci and Assocham as well as captains of the industry to discuss measures to boost growth and revive investor confidence in the economy.

Kidwai said the industry too wants the key economic bills for raising ceiling of FDI in insurance sector, opening pension sector for FDI and amendment to banking laws to be tabled in Parliament and passed at the earliest.

The Union Cabinet on Thursday is expected to take up big ticket financial sector reforms bills including hiking the FDI cap in insurance sector to 49 per cent and opening up the pension sector to foreign investment.

India Inc also asked the finance minister to continue the reform momentum and presented a to-do list of steps for reviving the economy including faster project approvals to kick-start core sector investments, lower interest rates, containing the fiscal deficit and boosting investor confidence in the economy. The two-hour long meeting was also attended by CII president and Godrej group chief Adi Godrej, Kris Gopalakrishnan, co-chairman Infosys, and YK Modi, chairman, Great Eastern Energy Corporation.

“While infrastructure financing was not a major issue as of now, it could pose a problem in the longer term once a large number of projects come on stream.

If Indian infrastructure companies can attract investors and get listed overseas first, the Sebi and the government should seriously consider opening up this avenue. Further, Minimum Alternate Tax on infrastructure financing should be removed,” Ficci president RV Kanoria said at the meeting.

“The key areas of intervention include the fiscal situation, starting the investment cycle, simplification of taxes and means of rejuvenating the manufacturing sector,” Godrej said.

Gopalakrishnan said the industry leaders discussed about infrastructure, IT and banking and finance beside other issues. Assocham president Rajkumar N Dhoot said that Chidambaram stressed on the importance of passage of the three Bills in the forthcoming session of Parliament.

Source : indianexpress.com