More reforms initiatives in next 2 to 4 months: FM

Committing to carry forward the economic reforms programme in the remaining term of United Progressive Alliance-II, Finance Minister P Chidambaram said on Wednesday the government will take more executive actions in the next two to four months and sought cooperation of the main opposition party to push through important bills in Parliament.

Ruling out early elections, the minister said the government would last for 13 months more and would continue to take small but significant steps to ensure that the country achieves its potential growth rate of 8 per cent.

"There is much more to be done.

"The remaining bills have to be passed.

"There are many more executive actions that have to be taken... Some of these are executive actions which we will take in the next 2-4 months.

"We will continue to take small significant steps. We will also take forward some big ideas.

"India's economy will continue to reform," Chidambaram said while addressing a conference organised by UK-based magazine The Economist. " The minister sought cooperation of the Opposition party to ensure passage of the land, insurance and Goods and Services Tax bills in Parliament, saying the economic issues should be dealt in a bipartisan manner.

"We have listed the things we intend to do.

“We want the Land Bill passed; Insurance Bill passed with FDI at 49 per cent. I sincerely seek cooperation of principal opposition party and other political parties.

"We want the regulator for coal sector, road sector in place; we want rail tariff authority in place to fix tariff in railway sector," the minister said.

Chidambaram also referred to the reforms initiatives taken
by the government in the recent past.

He said the government had been able to take tough
decisions with regard to opening of the multi-brand retail, deregulation of petroleum prices and freeing of the sugar sector partially.

The Minister further said it is important to ensure that both foreign and domestic investors continue to repose faith in the Indian economy, which he said is expected to grow by 6.1-6.7 per cent during the current financial year, up from 5 per cent in 2012-13.

Chidambaram said there is need to take a relook at the foreign direct investment caps which were fixed long ago.

"We need to open our economy more. We have to give more space for FDI," he said, adding the FDI caps could be removed if found no longer useful.

Two separate committees -- under RBI and the Finance Ministry -- are looking into various aspects of the foreign investment, including removal or raising of the FDI caps.

Promoting FDI was also essential to deal with the problem of widening Current Account Deficit, he said, adding it is likely to be below 5 per cent during the financial year 2012-13.

"CAD is indeed high. . . (it) is more worrying that fiscal deficit.

In 2012-13, CAD is expected to be $90-94 billion.

The satisfying aspect of this is that we have financed it completely without drawing down our reserves.

There have been copious inflows," he added.

The minister hoped that CAD would be close to 5 per cent during 2012-13 and "going forward, we will bring it down...

The way to do that is to boost exports. . .

"If we can conserve oil consumption by 10 per cent, we can save $17 billion.

"And if we can control our passion for gold, we can save many more billion dollars.

"It's a difficult act but I am confident that with the steps we are taking to encourage inward inflows, we will be able to bring it down," the minister said.

Image: P Chidambaram