The Confederation of Indian Industry has asked Prime Minister Manmohan Singh to fast-track economic reforms, which in turn would boost investments and accelerate growth, the organisation's new President Adi Godrej said on Thursday.
“We met the Prime Minister yesterday and discussed with him about taking the reforms process forward. This will help in improving perception about India's image, attract more investments and revive the growth,” he said at the industry body's press conference in New Delhi.
CII's main agenda is to restore growth, which could be done through reforms and better governance practices, he said.
“Both these areas will be concentrated upon. We will work closely with central government, state government and opposition to form a consensus on reforms, including allowing FDI (foreign direct investment) in multi-brand retail,” Godrej said.
In November last year, the Cabinet had approved allowing 51 per cent FDI in multi-brand retail. But the government had to put its decision on hold following protests from political parties mainly Trinamool Congress and DMK.
On economic growth, Godrej said with GDP growth at 6.9 per cent in 2011-12 against 8.4 per cent in the previous two years, the Indian economy is currently in the midst of a slowdown.
“Given the current status of the economy, we have ahead of us the Herculean task of reviving economic growth to the pre-crisis (economic slowdown of 2008) level of over 9 per cent. This needs structural reforms both at the central as well as the state level,” he said.
The government expects the growth rate to rise to 7.6 per cent during 2012-13 from the 6.9 per cent in the previous fiscal.
Godrej said to revive investment sentiment, the Reserve Bank of India needs to cut the interest rates by 100 basis points by December, 2012.
After a gap of three years, the Reserve Bank slashed the short-term lending rate (repo) by 0.50 per cent to 8 per cent. RBI had raised lending rates 13 times between March, 2010 and October, 2011 to contain inflation that had been hovering near double-digit. This had led to calls by industry to cut rates and spur industrial and economic growth that has slowed down considerably during the past few quarters.
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