Finance Minister P Chidambaram today promised fine-tuning of policies, corrective measures to put in place a stable and non-adversarial tax regime and a possible cut in interest rates.
He made it clear that his priority is to regain the confidence in both, domestic and foreign investors. Speaking to media first time after assuming charge of the Finance Ministry, Chidambaram said communication about the policies had to be improved. The Finance Minister said the Government had taken many measures, including the appointment of two committees to examine General
Anti-Avoidence Rules (GAAR) legal provisions and guidelines and other to review taxation of the IT sector and development centres.
Stressing the need to focus on large projects as well as infrastructure projects, the Minister said an Investment-Tracking System for projects with an outlay of a thousand crore or more had been put in place. Proposals pending with the Foreign Investment Promotion Board (FIPB) will be processed and decisions will be taken expeditiously.
Expressing concern over pressure on prices and inflation especially higher food inflation, the Finance Minister said some causes like price of crude oil and imported commodities were beyond the Government control but some others would be addressed by determined action. He said steps would be taken to remove the constraints on the supply side.
Chidambaram said stocks of foodgrain to moderate prices would be utilised . He said import of items in short supply would be enhanced, if necessary. He said the Government was conscious about the higher interest rates as it inhibit the investor and were a burden on every class of borrowers. He said appropriate steps would be taken in this connection.
Expressing concern over the weak south west monsoon, the Finance Minister said the Mahatma Gandhi National Rural Employment Gauruntee Act (MGNREGA) and other schemes would be converged to meet the challenge of drought.
Noting the strong foundation of Indian economy, the Finance Minister said it would overcome the challenges of the global economy and natural calamities like drought and floods. He reminded that the country overcame such challenges in 1991, 1997 and 2008. Chidambaram also indicated some more measures in next few days to overcome other difficulties.
