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Updated: April 15, 2012 09:59 IST

Economy facing challenges but we'll overcome them: Manmohan

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Isher Judge Ahluwalia, chairperson of the Indian Council for Research on
International Economic Relations, presenting Prime Minister Manmohan Singh with a copy of published essays by leading economists on economic reforms and developments in New Delhi on Saturday.
PTI Isher Judge Ahluwalia, chairperson of the Indian Council for Research on International Economic Relations, presenting Prime Minister Manmohan Singh with a copy of published essays by leading economists on economic reforms and developments in New Delhi on Saturday.

While admitting that the Indian economy has been facing “difficulties,” Prime Minister Manmohan Singh on Saturday expressed confidence that his government would overcome the challenges with “great determination.”

Speaking at the conclusion of a panel discussion here on ‘Challenges of economic reforms in India,' in which he was the chief guest, Dr. Singh said: “There are difficulties. Life will not be worth living if there are no difficulties. I am confident, with great determination, we will overcome.”

The panel discussion was organised by the Indian Council for Research on International Economic Relations (ICRIER) to mark the update and presentation of a copy of published essays by leading economists on economic reforms and developments. The book was presented to the Prime Minister by ICRIER Chairperson Isher Judge Ahluwalia.

During the discussions by the panel, which included Reserve Bank Governor D. Subbarao, Chicago University Professor Raghuraman G. Rajan and Business Standard Chairman T.N. Ninan, the urgent need for second generation reforms was highlighted even as attention was drawn to the maladies afflicting the economy.

Professor Rajan pitched for putting in place second generation reforms along with a hike in fuel prices in keeping with international rates, resolution of various bottlenecks and a “more kindly” treatment of foreign investors with respect to the budget proposal of taxation with retrospective effect. The tax should be levied with prospective effect as, despite a short-term negative impact, the step would be beneficial in the long term, he said.

Dr. Subbarao, while expressing concern over the widening fiscal and current account deficits, asserted that the economy now (in 2012) was far more resilient than what it was in 1991. The current downturn, he noted, was a short-term phenomenon and the economy was mature enough to absorb ‘shocks' and the country's growth story was intact. “The structure of the economy has changed [since 1991]. Our financial markets are more mature, more diverse and much deeper. They have the resilience to absorb shocks,” he said.

In his comments on the discussions, the Prime Minister said: “They [panellists] have thrown a new light on old problems. They have mentioned many challenges our economy is facing. There are difficulties …” Dr. Singh made these observations despite the fact that he had accepted the invitation on condition that he would not speak. “I had accepted this invitation on the condition that I will not speak. I don't wish to break that,” he said.

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The worst policy of Indian economy is to use costly and imported stuffs even by providing subsidies to help rich and rich oil and tech exporting economies. We ignore their cheaper and indigenous substitution stuffs and services by heavily taxing them though the same can help Indians specially poor and middle class. Look we are using cooking and water heating energy worth Rs 2.5 lca crore a year and providing subsidy of Rs 1 lac crore a year on the same and are completely ignoring free infinite solar for above purposes. We are subsidizing useless black money hiding imported bullion of 3.75 lac crore a year and have made indigenous real estate investment heavily taxed and heavily looked by taxmen. Time wasting tech stuffs mostly imported are also heavily subsidized as compared to other luxuries. No wonder why our trade deficits are Rs ten lac crore a year, fiscal deficit Rs six lac crore, total subsidy 10 lac crore a year to 1.25 billion Indians , number of poor increasing daily.

from:  alok
Posted on: Apr 15, 2012 at 18:43 IST

Manmohan Singh says that he will not speak. Sir, please tell something that we don't already know about you.

from:  rohan kothari
Posted on: Apr 15, 2012 at 14:00 IST

Sir,do u even remember since how long u r repeating this line?By "We" Do u mean ur ministers? Then they have really overcome their personal economic challenges for next 100years.You are not only a failed economist but a failed leaders as well.People of India believed on ur education but u failed them to unrecoverable limits.You took India into Abyss.

from:  Mac
Posted on: Apr 15, 2012 at 11:59 IST

We know that he very rarely speaks on the political issue, may be he does not have the mandate to speak. But promise to not to speak on economical issue as well, common PM you must be kidding. If it is so, please give a list of all issues on which you are supposed to speak.

from:  sunil
Posted on: Apr 15, 2012 at 11:04 IST

why should they be kind to foreign investors, fiis and all foreigners
are they doing philanthrophy work here, no amount of concession will be
enough for them. they earn here and take back home the profits at the
cost of india.

from:  bala
Posted on: Apr 15, 2012 at 10:49 IST

Is it economic relations???, I am finding something wrong going with the woman in the photo, note her saree had already dropped down..

from:  Yuvan
Posted on: Apr 15, 2012 at 10:35 IST
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