Economy

Pranab pooh-poohs reform fatigue, policy inaction

Our Bureau New Delhi | Updated on March 12, 2018 Published on July 20, 2011

The Finance Minister, Mr Pranab Mukherjee, interacting with reporters at the North Block office in the Capital on Wednesday. — Kamal Narang

The Finance Minister, Mr Pranab Mukherjee, denied any ‘reform fatigue' or policy inaction by the UPA Government.

Seeking to allay such fears, Mr Mukherjee told reporters at his North Block office here on Wednesday that a series of major economic enactments are likely in the upcoming monsoon session of Parliament beginning August 1. Bills on land acquisition, mining and mineral development, food security and the Lokpal will be introduced,

“On growth, inflation and reform measures, there is an impression that as if we have given up. I see no reason for such cynicism. All measures are being taken and there is no let-up in our efforts. There is a due process for each enactment and Government has to go through them,” Mr Mukherjee said.

He hoped that some of the financial sector-related Bills that were already introduced in the Budget session would get enacted.

The pending Bills include the Factoring Bill, the Banking Laws (amendment) Bill 2011 and the State Bank of India (subsidiary banks laws) Bill 2011

Mr Mukherjee indicated that the Government may pursue legislative changes to ensure more consolidation within the State Bank of India group. Continuing the consolidation drive, the Government may facilitate SBI in bringing under its fold at least two more associate banks this fiscal.

He also highlighted that the Government had already initiated the process of rewriting some of the old financial sector laws.

On FDI in multi-product retail, Mr Mukherjee said that discussions were on between ministries. He, however, declined to comment on Finance Ministry's view on the same.

On the wholesale price index (WPI) inflation, Mr Mukherjee said that he expects it to come down to 6-7 per cent by end March 2012.

“There is no doubt that inflation is continuing to be doggedly (persisting)…concern. But food inflation which was high at 22 percent in February 2010 has come down to 8 per cent. This 8 per cent is also not acceptable. But a declining trend is there,” he said.

Economic growth

On economic growth, Mr Mukherjee stuck to the Economic Survey's growth projection of 9 +/- 0.25 per cent for 2011-12. But a background note circulated by the Finance Ministry estimated the overall growth rate for 2011-12 at 8.6 per cent, higher than the 2010-11 levels of 8.5 per cent.

Referring to the controversial issue of black money, Mr Mukherjee said that “too much is being made of black money”. He pointed out that until the 2009 Pittsburg Summit, no country was agreeing to share information relating to black money.

Black money

“Whatever has happened (on tackling black money) has come about only after that summit. Now we are renegotiating our DTAAs and entering into tax information exchange agreements. Out of the 87 countries and jurisdictions with which we have existing agreements, negotiations have been completed for revision in respect of 57 countries. For 29 countries, negotiations are in progress,” he said.

On the cynicism expressed by Opposition parties regarding the Government's inability to get information from Switzerland, Mr Mukherjee pointed out that the entire process of Switzerland's ratification of amendment to existing DTAA is likely to be completed by September.

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Published on July 20, 2011
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