Govt to talk to banks to cut rates, increase finances: FM

Concerned over high credit cost and availability of funds, Finance Minister Pranab Mukherjee today said he will ask banks for a "benign plan of action" while committing to stimulate economic growth by stepping up public expenditure and speeding up reforms.     

"Industry and business have been hurt by the cost of finance and its easy availability... The cost and the speed with which finance can be accessed remains a matter of concern.     

"One of the first steps I propose to take is to meet bankers and get them committed to a more benign plan of action," Mukherjee said at his first press conference since taking charge as Finance Minister earlier this week.     

Listing out the concerns and constraints being faced by the economy, he said there was no alternative to pushing up growth in tandem with employment for which the government is willing to increase its borrowings.     

"Let me say unambiguously that we are committed to restoring growth and employment and that would not have been possible without increased spending funded by incremental borrowing. This would need to be further continued in 2009-10.     

"However, we are equally committed to the process of fiscal consolidation over a period of say 2 to 3 years," he said exuding confidence that early return to recent growth performance would help attain fiscal prudence.