Dismissing Standard and Poor’s cautious remarks on the Indian economy as a mere “point of view”, the Finance Ministry on Tuesday said GDP will expand by over 7.5 per cent in the current fiscal and more reforms measures would be taken by the government to push growth.
“We are expecting this year about 7.5% plus growth. The inherent stability factors of the economy are quite strong,” Economic Affairs Secretary Shaktikanta Das said while replying questions on the S&P report.
Observing that Indian economy is doing well and better than any other developed or developing nation, he said, “If S&P has taken a view, it is their point of view.
“The government will continue to take necessary reforms measures to improve the state of the economy and also to strengthen the inherent stability factor in our economy.”
S&P, in its report report on Monday, ruled out the possibility of upgrade of India’s sovereign rating in the current fiscal as well as the next financial year.
“The outlook indicates that we do not expect to change our rating on India this year or next based on our current set of forecasts,” S&P had said in a statement while retaining the country’s rating at BBB(—), which is the lowest investment grade rating.
The government, Mr. Das further said, has been taking steps to improve ease of doing business with a view to attracting overseas investments and encouraging domestic entrepreneurs.
Referring to his meeting with the representatives of foreign portfolio investors (FPIs) and foreign institutional investors (FIIs), he said several issues including those concerning with taxation came up for discussion and the government will try to resolve them expeditiously.
“Today, we had consultation with FPIs and FIIs. The whole intention was to basically understand them and resolve the issues which could be immediately dealt with,” Mr. Das said.
The FII representatives, Mr. Das said, raised several taxation issues which were addressed by the officials of the Central Board of Direct Taxes (CBDT).
The government, he added, will try to resolve the issues, and those which can be dealt with immediately would be attended to.
“A number of suggestions have come and they have to be looked into. They will be placed in front of the government and the government will take a decision,” he said.
He also indicated that the government might incorporate some of the suggestions made by FIIs at today’s meeting in the forthcoming Budget.
“Incidentally, since we are four months away from the Budget, some of the suggestions have been found to be very useful in the run-up to the Budget,” Mr. Das added.
The representatives of the FIIs also raised several operational issues, including problems with regard to registration.
“The first point that we have discussed was the operating environment of FIIs, the difficulties in day-to-day operations in respect of registration and reporting.
“We also discussed fund management industry in India and corporate bonds market (and) how to deepen them, how to enhance liquidity,” Mr. Das said.
Maintaining that Indian market has been giving good returns, Mr. Das tried to dispel any growth worries.
“With regard to confidence in India, I think the growth numbers are before you... also look at the returns which Indian market is offering to all investors, including FPIs. We are one of the best performing markets among our comparables,” he asserted.
The meeting was part of the government’s programme to address issues of investors with a view to improving ease of doing business in the country.
A similar meeting will be held tomorrow with domestic market participants.
