Even as he stressed the need for reforms, Union Finance Minister Arun Jaitley on Friday advocated an increase in public spending and tapping domestic savings to finance infrastructural projects.
In order to attract investment, Mr. Jaitley said “all models of financing would have to be explored” and a structure of financing would have to be put in place. The country cannot rely solely on foreign investment; it needs to increase public spending, while also converting domestic savings into infrastructural financing. He was addressing the “Mumbai Next” meet.
Jaitley hints at more reforms, faster decisions
Speaking via video conference at “Mumbai Next”, a discussion organised by the Maharashtra government on ways to convert Mumbai into a global financial, commercial and entertainment hub, Mr Jaitley said: “The government does not believe in living on borrowed money. The whole concept of spending beyond your means and leaving the next generation in debt to repay what we are overspending today is never prudent fiscal policy.”
At the discussion attended by leading industrialists, artists and politicians, the Minister said: “Infrastructure creation in the last few years has admittedly slowed down. Quick decisions need to be taken.”
Responding to a question from Mukesh Ambani, chairman, Reliance Industries Limited on how Centre-State coordination would help in fast-tracking the Mumbai infrastructural projects that had been stuck for the past few years, the Minister said the issue of financing infrastructural projects pertained to not just Mumbai but the whole of India.
Mr Jaitley said the Centre needed active cooperation from each State that desired reforms. “India is no longer a country governed by cooperative federalism. It has entered the era of competitive federalism. He who wants reforms will take the country forward. Why not Maharashtra?” Mr. Jaitley asked, pointing to the investment potential of Mumbai.
“Probity and decisiveness will take the State to new heights of growth. We will extend whatever support is required,” he said.Mr. Jaitley said the government was trying to rationalise expenditure. Hinting at a stable tax regime to be unveiled, he said the State and the Centre would not engage in unfair efforts to mop up revenues.
