New Delhi, December 23, 2011 : Prime Minister Manmohan Singh has assured Industry leaders about economic reform while meeting his member of council for trade and industries. Corporate leader such as Mukesh Ambani, Ratan Tata, Sunil Bharti Mittal, Rahul Bajaj, Chanda Kochhar, Deepak Parekh and Swati Piramal among others were present. According to PM ‘Government is committed to economic reforms’ and delay in implementing is temporary in nature. Sometime it take more time than anticipated.
He highlighted various concerns which industry leader has raised from time to time. High interest cost, Delayed execution of large infrastructure project, widening Fiscal Deficit and manufacturing challenges are some of the main agenda on which industry would like to see ‘walk the talk’ by government.
What is so different now?
The meeting holds significance in the backdrop of recent economic indicators which clearly indicate that in order to fight Inflation the steps taken by government and more particularly RBI’s rate tightening regime has resulted in to demand contraction and reduced industrial activities.
As indicated by recent data on WPI Inflation, Food Inflation, IIP and Quarterly GDP numbers it is high time for government to shift focus from Inflation to growth.
What could derail reform agenda?
RBI seems to run out of ammunition and have exhausted all his option even after that Inflation is above 9% mark. It is big gamble they are playing as any uprise in Inflation due to incidents beyond anybody’s control will land up Indian economy and government in very disastrous state.
Going by the figures no matter what PM tells in public forums they do not have the numbers in their hand to carry out reform as they would like to. On all the key issues such as large ticket legislation be it FDI in Retail or FDI in Insurance or Goods and service Tax (GST) they have to rely heavily on their allies such as Trinmool Congress (Mamta Banerjee), NCP (Sharad Pawar), DMK (Karoonanidhi) and thats is where they have to compromise partly or may have to shelve the whole idea as shown in case of FDI in Retail where Mamta Banerjee virtully blackmailing government and now its on backburner.
Another indication of multiple power center pursuing different agenda is the silence of Pranab Mukherjee and Sonia Gandhi on key reform agenda clearly indicating all is not well and there is crack within congress.
Only option left out with Prime Minister Manmohan Singh led UPA is to walk the talk and not only give lip service to the nation. Right now government is occupied in various issues which is clearly visible is taking toll on core developmental issues. If any body expecting to replay of 1991 situation one should keep fundamental diffrence between then and now is in 1991 nation was led by a astute politician P. V. Narsima Rao and he had the courage to give free hand to the then FM Mr. Manmohan Singh and Now in 2011 nation is being led by world renowed Ecomist Manmohan Singh who neither have courage and nor has Team which sincerely listen to him. Even on various occasion one can easily realise that Mr. Pranb Mukhrjee is discharging more power than PM.