The Telegraph
Thursday , November 15 , 2012
Since 1st March, 1999
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Pranab pins hope on reform impact

New Delhi, Nov. 14: President Pranab Mukherjee today expressed optimism that the government’s recent reform measures would help reduce fiscal deficit and put the economy back on the growth trajectory.

“Important among these have been the decisions to allow FDI in multi-brand retail and civil aviation and seek legislative approval for increasing the FDI cap in the insurance and pension sectors,” Mukherjee said at the India International Trade Fair here today.

“Measures have also been announced to keep the government’s subsidy burden in check, thereby bringing about a reduction in the fiscal deficit,” Mukherjee said, adding that “these measures should help in restoring the economy’s growth momentum”.

The budget for 2012-13 had estimated fiscal deficit at 5.1 per cent of GDP. However, the government later raised this deficit target to 5.3 per cent.

Industry wants the government to push its reform agenda further, calling for a more business-friendly tax regime and speedy clearances for infrastructure projects.

The government, which faced stiff opposition from regional allies as well as opposition parties for its reform policies, is bracing for a stormy Parliament session when it meets next week to get the crucial amendment to the Foreign Exchange Management Act.

The President said “economic changes necessarily have social ramifications. In order to keep pace with the rapid global changes, we need to constantly finetune the skills of our work force”.

He also stressed that small units were a source of rural empowerment, which was one of the key objectives of inclusive growth.