Economy

Ready to tackle monsoon deficit: Jayant Sinha

Jayant Sinha.  

nion Minister of State for Finance Jayant Sinha said that the government was fully prepared to tackle the fall-out of a deficient monsoon.

“We are fully prepared this year. We have a number of contingency plans and a rapid response mechanism in place,” he said in response to a question on predictions of a deficient monsoon this year.

Mr. Sinha said that despite last year’s 88 per cent rainfall deficiency, the government had managed the overall situation in terms of food supplies and prices.

“We managed well. And, inflation has now come down, leading to lower interest rates. So, we are fully prepared this year… we will be able to handle,” he said.

Mr. Sinha, who was addressing a special session of the Bharat Chamber of Commerce in Kolkata, said that moving the stalled projects was one of the bigger challenges before the government. “There were structural reasons such as land acquisition and environmental hurdles, which led to stalled projects”, he said.

To a question on CST compensation, he said that in order to remove the trust deficit created between the Centre and the States over this issue during the previous regime, the NDA-2 government planned to clear the arrears in three phases by March 2017.

“The first Rs.11,000 crore was paid by March 2015. This fiscal, two more pay-outs will be made to the States, clearing the CST compensation by March 2017”.

To a question on political opposition to GST, he said that as of now, there was a broad-based consensus and the GST Constitutional Amendment should be possible in the current session of Parliament. The few issues that were remaining in terms of implementation and formulation of GST Bill would be considered at the meeting of the GST Council on May 8.

PTI adds

Maintaining that higher borrowings by individuals would lead to purchase-led growth, Mr. Sinha said interest rates should fall and, hopefully, the Reserve Bank of India (RBI) would look into that.

“Interest rates should fall so that higher borrowings will lead to more purchases of articles and the RBI should look into that aspect,” Mr. Sinha said at an interaction organised by the Bharat Chamber of Commerce here.

“RBI is a very professional data-driven organisation and they would obviously look at the facts before taking any decision,” the minister told reporters, when asked specifically whether the central bank should cut rates.

“So, let us see how the data play out,” he said, with a cautious tone, clarifying that a rate cut was not imperative for re-starting stalled projects.

Public debt management

Referring to branching out public debt management from the ambit of the RBI, Mr. Sinha said there had been a lot of resistance from the officers and employees of the central bank.

“Worldwide, public debt was being managed by an outside entity and not the central bank. But RBI was doing a very fine job... When you are reforming, you can expect opposition.

“Even the RBI Governor feels strongly about creation of a separate public debt management body,” Mr. Sinha added.


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Printable version | Oct 22, 2021 7:02:39 PM | https://www.thehindu.com/business/Economy/rbi-should-look-into-interest-rates-sinha/article7141444.ece

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