Finance Minister Nirmala Sitharaman said Thursday the government is doing whatever it takes to support the economy and urged industry leaders to increase investment and build capacity in domestic chip manufacturing and renewable energy.
The government is pursuing important economic reforms and doing “tough work” to achieve the privatization plan outlined in the budget, and hopes to complete the strategic sale of Air India, BPCL, among others, within this fiscal year, she said.
Speaking at the CII annual meeting over video link, she said the four engines of economic growth – net exports, government spending, consumption and investment – are starting to work well to aid the recovery process. The economy is buoyant in terms of recovery during the recovery period. “The government is determined to do whatever it takes for the economy to run,” she said.
“Growth will be a priority, growth will be important, and growth will be driven by both the Reserve Bank and the government,” she said. While the central bank will take measures to curb inflation, growth will make all the difference to economic recovery, she said. The minister indicated that the RBI would continue its accommodative and growth-promoting policies. “I am glad that the RBI has indicated that pulling back or sucking liquidity out of the economy too quickly may not be the necessary incentive that is needed and has given no indication of sucking out the available liquidity.” said, adding that the government and the RBI have worked closely together.
Finance Minister Nirmala Sitharaman said the government and RBI will continue to support the economy to encourage industrialists to increase their investments.
Exports of steel and many others have risen recently while the center has increased its infrastructure investments. Consumption has also received the necessary boost from various government policies, she argued.
She said the nature of investing has changed as citizens are now more open to investing in the stock markets. It is the best time for Corporate India to step up risk taking as the corporate tax rate is among the lowest and there is an opportunity to build capacity for domestic chip manufacturing and renewable energy, she added. Foreign direct investment “flows into India continuously” because it believes in solid macroeconomic fundamentals with the legal changes required to end retroactive taxation.