Amid threats that India’s credit rating could be downgraded and a slowdown in the economy, Planning Commission Deputy Chairman Montek Singh Ahluwalia on Monday said the government has taken several steps to boost investor confidence and more such measures may follow.
“Lot of examples can be given on the steps the government has taken to get rid of impediments in movements of large projects. I think I am hoping that we will have more such steps. Lots of internal administrative decisions have been pushed forward,” Mr. Ahluwalia told reporters at a seminar here.
On the GDP growth rate, he said the second half of the year will be better in terms of growth.
Mr. Ahluwalia said, however, the situation is still under watch despite the fact that deceleration has stopped.
“Deceleration has bottomed out. We are doing a number of things which I think will lead to revival of investor confidence. And the affect of these things always take a few months,” he added.
Of late, credit rating agencies such as Standard & Poor’s have warned of lowering India’s credit rating in 24 months to ‘junk’ grade, if the country fails to carry out requisite economic and fiscal reforms.
Besides, they have lowered economic growth projections for the current fiscal and reduced the outlook to negative.
The Reserve Bank has also revised downwards the GDP growth estimate for the current fiscal to 5.8 per cent from the earlier 6.5 per cent, while increasing its March-end headline inflation forecast to 7.5 per cent.
Meanwhile, the government has recently cleared proposals to allow the FDI in multi-brand retail and aviation sectors, besides agreeing to hike FDI limit in the insurance sector.