Finance Minister P Chidambaram today asserted mistrust among investors needs to be removed to boost investment in the country. For this, he said, communication about the policies has to be improved. He was speaking to media first time after assuming charge of the Finance Ministry.
Chidambaram said the key to restart the growth engine was to attract more investment both from domestic and foreign investors and the Government would leave no stone unturned to regain investor's confidence. 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.
The Finance Minister said clarity in tax laws, a stable tax regime, a non-adversarial tax administration and a fair mechanism for dispute resolution besides independent judiciary would provide great assurance to investors. He asserted that corrective measures would be taken wherever necessary.
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 Rs 1,000 crore or more had been put in place. Proposals pending with the Foreign Investment Promotion Board 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's 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 that import of items in short supply would be enhanced if necessary. Stating that non-food inflation was already declining, he expressed confidence that inflation would be moderated in the medium term.
Chidambaram said the Government was conscious about the higher interest rates as it inhibited 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 the Indian economy, the Finance Minister said it would over come the challenges of the global economy and natural calamities like drought and floods as well. He reminded that the country overcame such challenges in 1991, 1997 and 2008 also. Chidambaram also indicated some more measures in next few days to overcome other difficulties.
