Press Information Bureau

Government of India

Ministry of Finance

22-November-2012 19:10 IST

The measures undertaken by the Government of India to revive the economy, inter-alia, includes better access to finance for manufacturing sector, fast tracking of large investment projects in the areas of power, petroleum and gas, roads, coal etc, use of buffer stocks to moderate food inflation, strengthening of financial and banking sector, reducing the volatility of exchange rate etc. Certain specific measures taken by the Government to achieve higher growth, inter-alia, include enhancing the level of investment for agriculture sector including irrigation projects, promoting Micro Small and Medium Enterprises (MSME) sector by way of higher allocation of funds, enhancing investment in the infrastructure sector focusing on Public Private Partnerships, a number of legislative measures to develop the financial sector and introduction of a new National Manufacturing Policy etc. Measures are being undertaken to facilitate fiscal consolidation and to expedite the passage of Direct Tax Code Bill and evolving a consensus among stake holders in implementation of goods and services tax. The steps recently outlined that include reduction in the subsidy on diesel, announcement of disinvestment in certain PSUs, along with measures to strengthen the investment climate (opening of FDI in multi-brand retail, aviation, broadcasting) are expected to revive market confidence and restore growth momentum.

The need for greater coordination between monetary and fiscal policies has been emphasized time and again in many fora. The monetary and fiscal policies are broadly complementary and are expected to restore the growth momentum.

This was stated by the Minister of State for Finance, Shri Namo Narain Meena in a written reply to a question in the Rajya Sabha today.

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Economic revival measures prioritise fiscal and monetary coordination to boost investment, stabilize inflation, and improve access to finance. Government announced economic revival measures emphasising improved access to finance for manufacturing, fast-tracking large projects in power, petroleum and gas, roads and coal, use of buffer stocks to moderate food inflation, strengthening of the financial and banking sector, and steps to reduce exchange rate volatility; fiscal and structural measures include higher investment in agriculture and MSMEs, infrastructure via PPP, legislative steps toward a Direct Tax Code and GST consensus, and selective subsidy reduction and disinvestment to strengthen the investment climate.