Industry bodies have lauded Prime Minister Manmohan Singh for taking bold decisions to move ahead with reforms despite political compulsions.
“With his action last week and address to the nation last evening, the Prime Minister has unambiguously sent a message that the Government is determined to see through the reforms that have been at the centre of a political controversy lately,” CII said in a statement.
CII President Adi Godrej expressed hope that this would be the beginning of a series of reforms that the country needed to arrest the economic downtrend and ensure higher growth for greater inclusiveness.
FICCI Vice-President Sidharth Birla said the recent government steps would begin to address the fiscal position, thereby reviving investor confidence.
The industry felt that increase in the prices of diesel and LPG can be seen in the context of unsustainable fuel subsidies and the need to improve the fiscal position.
Drawing comparison with the economic liberalisation of early nineties, Godrej said when India had the first round of reforms in 1991, there was pain and apprehension and the economics was not fully appreciated.
“It is to be noted that every government since then, irrespective of their political colour, has taken that process forward. The economic logic of these reforms has been too compelling for anyone to ignore,” he said.
He added that the per capita income of India has grown several fold and India is the second fastest growing economy in the world.
“We have also seen poverty come down over the last two decades,” Godrej said.