Sitharaman to meet CMs, state FMs on Monday

Union Finance Minister Nirmala Sitharaman will on Monday meet chief ministers and state finance ministers to discuss measures to attract private investments to help boost the economy.

Finance secretary T V Somanathan said the meeting comes in the backdrop of strong economic recovery post the two COVID waves, and the central government has made a big push in Capex.

The focus of this interaction will be on state-level issues, opportunities and challenges, which will enable us to go to a higher trajectory of investment and growth, he said.

"There is capital expenditure from the government side, and there is a positive sentiment from the private sector side, though perhaps not fully translated into actual investment in big scale.

"(However,) capital market activity indicates that a lot of investment is probably on the cards.

"This positive sentiment is something that the Government believe should be capitalised on in order to take India forward to a higher, sustainable growth trajectory.

"It's an opportunity, an opportunity that we should not let go," Somanathan said.

The secretary was briefing reporters on the virtual meeting of Sitharaman with state chief ministers and finance ministers on November 15.

He said the global geopolitical developments give India a certain advantage position, and therefore India is becoming, in relative terms, a more attractive destination for investment, both domestic and foreign.

"So, in order to take India to higher growth, there are actions to be taken by the private sector, and there are policy actions to be taken by the government.

"Some of the actions lie with the Central government and the central government has been making efforts to do what is needed.

"But, several of the things which are needed to push India to a sustainable higher growth path lies with states," he said.

The purpose is to use this present juncture not only to drive growth through central policies but also take states along, he said, adding that the focus of the meeting would be the economic impulses of the states and not on states' revenues.

Economic Affairs secretary Ajay Seth said the discussion during the meeting will revolve around state-level issues, like land, water, electricity availability and how policies can be eased for attracting investments.

In a statement, the finance ministry said growth had slowed down in the COVID-19 pandemic.

However, after the first quarter of the current fiscal, the economy has picked up again, with green shoots of recovery clearly visible.

Indian economy contracted 7.3 per cent in the last financial year after a 4 per cent growth in 2019-20.

In the April-June quarter of the current fiscal, the economy grew 20.1 per cent.

Several economic indicators are now at pre-pandemic levels.

Projections of the IMF and World Bank peg India's GDP growth to about 9.5 per cent and 8.3 per cent, respectively, as one of the fastest-growing economies.

"While the investor sentiment is good, there is a need to capitalise on the momentum already created.

"The first four months of FY 2021-22 have already witnessed inflows of $64 billion Foreign Direct Investment (FDI)," the statement said.

The interaction will attempt to create a policy discourse and a facilitative environment for inward investment-led growth.

"This will be enabled by a pro-active approach to investment promotion, efficiencies brought about by Ease of Doing Business reforms, and an emphasis on accelerating approvals and clearances up to Urban Local Bodies (ULB) levels," it added.

Through the interaction, the states would share their ideas and vision for enhancing the investment climate, leading to a broad consensus regarding the trajectory to be undertaken for India to become the fastest-growing economy.

Photograph: ANI Photo