The Hindu : New Delhi News : ‘Economy sound, Congress best for Delhi, country’

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‘Economy sound, Congress best for Delhi, country’

Staff Reporter

Chidambaram assures that Indian banks are safe

All smiles: Union Finance Minister P. Chidambaram interacting with the media while Delhi Pradesh Congress Committee president J. P. Agarwal looks on at DPCC office on Tuesday.

NEW DELHI: Union Finance Minister P. Chidambaram on Tuesday sought to dispel fears about a financial crisis in the country saying “India remains one of the most attractive places to invest”.

As for the stock market crash that deprived a lot of small investors of their hard earnings and saw even mutual funds lose money while the foreign institutional investors exited at higher levels, he said “it is not the job of the Government to advise investors”.

Visiting the new Delhi Pradesh Congress Committee office here for the first time for the Delhi Assembly elections campaign, Mr. Chidambaram said: “Those who invested in bonds have not lost their money. Those who are in the stock market know that they are taking a risk. Sometimes you multiply your gains, sometimes you lose.”

Regarding the loss of lives following the market fall and the rise in crime related to such losses, the Finance Minister said there could be several reasons for such deaths. Incidentally, the BJP has also made an issue of the stock market crash in Delhi.

The Union Minister also declared that Indian “banks are 100 per cent safe and no one should have any apprehension about them, the deposits have been growing over the past three to four weeks.”

He said it was good that the UPA and not the NDA had been voted to power in 2004 as the latter wanted to bring down government holding in PSU banks to 33 per cent from 51 per cent. Mr. Chidambaram said people should vote for the Congress in Delhi as the party stands for “universality, inclusion and tolerance” while “the BJP does not represent the basic values of India and is sectarian, exclusive and intolerant and everything about it flows from this.” “Delhi’s only ethos is of secularism and tolerance that the Congress is committed to. All narrow identities merge here in that I am an Indian.”

The country, he said, had never recorded less than 9 per cent growth in the past three years and the four year average was 8.9 per cent. He said while the global crisis was manifesting, it would still be wrong to say that India is in a recession as this term relates to negative growth in two successive quarters, something that has been seen by United Kingdom, Germany and Japan and may soon be seen in the United States and France. “But in the quarter ending July 2008 we had 7.9 per cent growth and even in the quarter thereafter there positive growth is expected.”

Stating that the concern of the Government was to ensure that the growth that was at 9 per cent goes back to that level from the present level of between 7 and 8 per cent, he said as per the plan of action since foreign investment is slowing down, more resources are being generated in the domestic market and as exports are declining due to the slowdown abroad, the domestic demand would be stimulated.

On the rate of interests, the Minister said it is for the Reserve Bank of India to take the final decision. “We had reduced the rates by 75 basis points and the PSU banks have passed them on.”

As for inflation, that is also becoming a major election issue in Delhi, Mr. Chidambaram said after remaining in check for over three years, the inflation began going up in 2007 due to a rise in crude oil prices then went up from $ 27 a barrel during NDA rule to $ 147 a barrel earlier this year.

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