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The Finance Minister, Mr Pranab Mukherjee, on Tuesday urged institutional investors, especially the foreign ones, to remain optimistic and take a long-term view of the economy.
Stating that the Indian growth story was robust, Mr Mukherjee told a gathering of over 30 leading Indian and foreign institutional investors that they should not get disturbed by the current headwinds. “The Government is committed to doing all that is necessary to achieving and sustaining a higher economic growth rate,” he said.
Mr Mukherjee sees the Indian economy registering 8.5 per cent growth in current fiscal, higher than the 8 per cent recorded in 2010-11. He also expressed confidence over achieving the fiscal deficit target of 4.6 per cent of GDP for 2011-12.
On foreign direct investment (FDI) in retail and insurance, Mr Mukherjee said that consultations are underway and assured the institutional investors that all efforts would be taken to build a consensus on the matter.
Referring to inflation, Mr Mukherjee said that it is likely to moderate in the months ahead especially as the monsoons are expected to be normal strengthening the economic prosperity of the farmers.
On financial sector reforms, Mr Mukherjee said that next generation reforms have already been initiated. These include widening and deepening of the Indian securities markets, liberalising the policy on foreign capital flows, strengthening the regulatory and other institutional architecture and reducing transaction cost in the securities markets, among others.
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