Comm Min, FM to meet industry on falling output

Expressing concern over the weak industrial production and higher cost of credit for the industries, Anand Sharma, union minister for commerce and industry, textiles, Government of India, informed that a joint task force of the industry and government will meet up on December 19, 2011 under the chairmanship of the finance minister. The meeting of joint task force will be followed by a meeting on industry and trade with the Prime Minister, where the future course of action will be decided, informed the minister here.

Sharma raised concerns over the decline in the growth industrial output, which slowed down to 1.9 per cent in September and has been witnessing a declining trend during the year. Adding to the worries for the government is the slow economic growth, which was recorded at 6.9 per cent in the second quarter."In the month of July, for two consecutive days, we met with the captains of the industry, and we decided as a government to set up a joint taskforce between the government and the industry for a structured dialogue. The first meeting was held in August, while I have called the meeting of the joint task force again on the December 19," said Sharma on the sidelines of an event held at National Institute of Design (NID) in Ahmedabad on Saturday.

He mentioned that at the first meeting, chaired by the finance minister and joined by the commerce minister himself, the industry captains raised the issued faced by them that have led to the decline in the industrial production. specifically in the core sectors and manufacturing and mining.

The task force set by Sharma, includes industry leaders like Venu Srinivasan of TVS Motors, Harsh Pati Singhania, Sanjay Kirloskar and Rajiv Kumar from Ficci.

"After the dialogue and the meeting of the joint working group, I will again be discussing (the issues of industry), with both the Prime Minister and the finance minister with the Prime Minister chairing the meeting on trade and industry," Sharma said adding that a combined effort from government, the Reserve Bank of India and the industry would help improve the situation.The industry, mainly manufacturing industry is reeling under trouble due to higher interest rates and low demand overseas. "It's true that the availability of credit and the cost of credit to keep the industry globally competitive is also one of the factors. And the finance minister, had responded positively to our request to look at the cost of credit. And the interest subvention has been made available to the SMEs and to the labour intensive sectors," added Sharma.

He mentioned that there are demand-supply issues that are holding back growth in industrial production.

Denying any requirement of stimulus package for the industry, Sharma mentioned that not only stimulus package can increase the industrial production. "There are demand-supply issues. There have been global crisis for the last five years and the global economy has not returned from the shock of the crisis of 2008-2009. It has been universal but not uniform, some countries rebounded quickly but challenges do remain," he added.