BIG PUSH

New Delhi, Nov. 2: The government is likely to come up with a raft of measures to accelerate industry growth.

Tomorrow’s meeting between Prime Minister Manmohan Singh and some top guns of industry is expected to chart out the future course of action.

The main agenda will be to increase public spending through the public-private-partnership principle for better infrastructure and more jobs.

However, the government will have to work out a funding strategy for the projects as it is burdened with a rising subsidy bill and a huge debt on account of the loan relief to farmers.

The Prime Minister’s economic think-tank, led by finance minister P. Chidambaram and Planning Commission deputy chairman Montek Singh Ahluwalia, would also be at the meeting.

Ratan Tata, Mukesh Ambani, Kumarmangalam Birla, Anand Mahindra and Sunil Bharti Mittal are the industrialists expected to attend the deliberations.

Among others likely to attend are bankers K.V. Kamath and Deepak Parekh, and realty moghul K.P. Singh of DLF.

With industrial growth plunging to 1.3 per cent in August, the businessmen are likely to highlight the challenges to increasing production because of the liquidity crunch.

Economists have been rooting for increased government spending as a way out of the current crisis, given that private investment and consumption have slowed down.

The government can begin by kick-starting new highway projects and ports and accelerating work on the Delhi-Mumbai rail-freight corridor.

Social infrastructure

According to officials, the government would also like to infuse more money into social infrastructure such as schools and hospitals.

Apart from setting up 2,500 model schools under the public-private-partnership initiative, the government would want to invest on its own in 1,000 Kendriya Vidyalayas, 700 Navodaya Vidyalayas and 1,000 model schools, the officials said.

Big wishlist

Industry leaders are also expected to press for further lowering of the repo rate, setting up of a special fund for sectors which have greater exposure to risk and protecting non-banking finance companies against defaults by converting them into banks and bringing them under regulation.

The wishlist may include increasing the foreign direct investment limit in telecom, insurance, multi-product retail and aviation, and raising long-term money via NRI bond issues, sources said.

In manufacturing, the industry could ask the government to review the imposition of export duty and reduction in import duty on several items that were introduced to contain inflation.

Sources said the government should take measures to promote growth of small and medium enterprises.