Opening up multi-brand retail to foreign investments is very much on the UPA Government's agenda. A consensus to implement the decision to allow FDI in multi-brand retail trade is being worked out, the Finance Minister, Mr Pranab Mukherjee, said here on Tuesday.
Pushed to a corner by the stalling of Parliament by Opposition parties and dissent from its key allies — the DMK and Trinamool Congress — the Government had in early December 2011, suspended its November 24 decision to allow 51 per cent foreign direct investment (FDI) in multi-brand retail.
Debt finances
Addressing the 91{+s}{+t} Annual Session of Assocham here on Tuesday, Mr Mukherjee said there was unwavering commitment to reforms. He listed various policy measures in the recent months to further ease capital controls and make available a framework for pooling debt finances for infrastructure.
Mr Mukherjee said the Government had further liberalised FDI in single-brand retail by allowing up to 100 per cent investment. FDI flows, which had considerably slowed in 2010-11, have bounced back. As of January 2012, FII inflows also picked up, he said. The Finance Minister said the Indian economy was, in some ways, better placed than other nations to withstand a fresh round of global economic turmoil, as the bulk of India's GDP was domestic demand-driven.
Slowdown temporary
Mr Mukherjee said the country needs to target double digit growth in the not-too-distant future. “We have shown that we can grow fast but we must learn to sustain it over an extended period of time”.
Admitting that growth had slowed, he said this was due to the tight monetary policy, which had impacted investments and consumption growth through higher cost of credit. “Nevertheless, we have been able to keep the adverse impact of global slowdown and uncertainty on our economy to the minimum. I expect this slowdown to be temporary and the economy would soon revert to the high growth trajectory”.
The Indian economy is estimated to grow 6.9 per cent this fiscal, lower than the 8.4 per cent growth recorded in 2010-11.