Steps taken by govt to revive growth: Rajan

The Finance Ministry on Tuesday exuded confidence that recent initiatives of the government will push economic growth rate in the current fiscal and made a case for quick passage of reforms legislations like the GST and insurance bill to improve investor confidence.

"Increasing the growth rate is what we intend to do. And overtime the measure which have already been taken will also start kicking in, which will increase the growth rate," Chief Economic Advisor in the Finance Ministry Raghuram Rajan said.

The economic growth in the January-March quarter stood at 4.8 per cent and for the full fiscal it was at decade's low of 5 per cent. As per the Finance Ministry's estimates the economic growth rate in the current financial year was likely to be 6.1-6.7 per cent.

The government is not satisfied with the 4.8 per cent GDP in March quarter, he said and hoped that good Rabi crop and accelerated government spending would catapult growth.

"There are a number of pieces of legislations which has to be passed. If we can summon up for the passage of GST, insurance and companies bills, that could be a signal to domestic and external investors that there is a forward movement. So legislations help growth by enhancing investor confidence," Rajan said.

Rajan further said the overall WPI inflation is showing signs of easing and efforts should be made to bring down food inflation. The WPI in April stood at 4.89 per cent.

He said the retail inflation too would come down and hoped that it would find reflection in the next monetary policy of the RBI which is due on June 17.

"I hope in coming days you will see lower CPI. You will see RBI policy cuts actually gets traction and there will be an improvement in growth", Rajan said.

While the Goods and Service tax (GST) Bill will usher in a new indirect tax regime, the insurance bill seeks to raise FDI cap in the sector to 49 per cent, from existing 26 per cent.

Referring to the recent Cabinet Committee on Investment's (CCI) clearances to projects worth about $27 billion, he said, "We need to do more. In the next few weeks we will be able to announce measures on coal pricing."