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Hinting at opening up of more sectors to foreign investment, Prime Minister Narendra Modi on Wednesday said areas with high employment potential and strong local talent would be the focus to woo foreign investment and expressed confidence that reforms measures like the Goods and Services Tax (GST) and land acquisition Bill will be passed in "a matter of time".
On the land Bill, which the government wants to push early but has now been referred to a parliamentary committee, he said the government would accept any suggestions that benefit "Gaon, Garib, Kisan (village, poor and farmer)".
In a wide-ranging interview to PTI, Modi asserted that measures already taken in past one year had increased the attractiveness of India as an investment destination and investor confidence had improved.
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He also dismissed suggestions of differences between finance ministry and Reserve Bank saying the central bank has its functional autonomy which the government "will always respect and preserve".
"Wherever there is high employment potential and wherever we have strong local talent, for example, in research and development: those will be the areas of focus for foreign direct investment (FDI).
"We have created the National Infrastructure Investment Fund. This is a major step which will increase the flow of foreign investments into all infrastructure sectors, without needing separate sector-by-sector approaches," he said.
Asked whether obstacles to reforms measures like GST Bill and amendment to Land Acquisition Bill was hurting the economy, the Prime Minister said both the GST and the proposed Land Acquisition Bill were beneficial for the country.
"The core essence of these Bills should be appreciated by all the parties keeping aside political motives. Long term interest of the nation should be foremost."
"The fact that the States have agreed to the GST design, shows the maturity of our federal system and the GST Bill has already been passed by the Lok Sabha. It is a matter of time before these laws are passed," he said.
To a question what kind of a message would it send to foreign investors if reform measures are not pushed fast, the Prime Minister said, "One of the peculiarities of Delhi is that the term 'reform' is associated only with passing of laws in Parliament.
"In fact, the most important reforms needed are those without new laws at various levels of Government, in work practices and procedures."
Modi said the government has initiated a number of major reforms which include decontrol of diesel prices, direct transfer of cooking gas subsidy, enhancement of FDI limits, revamping of railways and many others.
"The truth is that reform has actually been pushed very fast and in fact as a result FDI has already witnessed an increase of 39 per cent in the period April, 2014 to February, 2015 compared to the previous year," he said.
He also maintained that the success of steps that the government had taken and the positive response of the people to them in the first year "have encouraged us to do even more".
"Our focus will be on P2G2, i.e. Pro-active, Pro-people Good Governance reforms. Another aspect we will emphasize and strengthen is that the State and the Centre are one team which has to work together for reforms to be effective," he said.
Asked about reports of RBI and finance ministry on the same page on issues, Modi said, "I am surprised that an important and credible media agency like PTI is drawing an incorrect inference based on remarks made in different contexts. RBI has its functional autonomy which the Government and the Finance Ministry always respect and preserve".
On the economic growth prospects for the current year, Modi said based on experience of the last year and the enthusiasm of the people give confidence that all economic indicators will exceed the targets.
"I do not want to undermine the potential and the efforts by giving any figure which may turn out to be too low," he said.
To a question about Opposition accusation that the government was pro-corporates while some in industry like Deepak Parekh say nothing is happening on ground, he said, "The answer is to be found in your question itself. If opponents are accusing us of being pro-corporate but the Corporates are saying we are not helping them, then I take it that our decisions and initiatives are pro-people and in the long term interests of the nation".
On the issue of making progress on the BJP's election promise on stringent action against back blackmoney, he said the very first decision of the Government after taking office was to constitute the Special Investigation Team to pursue black money.
"This step had been pending for years with no action and we executed it in our very first Cabinet meeting.
Subsequently, we have also brought a new Bill which will combat black money held abroad and it prescribes stiff penalties.
"Thanks to our efforts, an agreement was reached at the G-20 summit in November 2014 to curb tax evasion and in particular to exchange information between countries. This will help us to trace black money. These are very strong and concrete actions," he said.To a question on the agrarian crisis in the country, the Prime Minister said suicide by farmers has been a serious concerns for several years.
"Political point-scoring through comparing how many suicides occurred under which government will not solve the problem. For a government of any party, and for every one of us, even one suicide is worrisome," he said.
WHAT MODI SPOKE
- Dismisses suggestions of differences between finance ministry and RBI, saying the central bank has its functional autonomy which the govt 'always respects and preserves'
- On GST Bill and amendment to land Bill, he said core essence of these should be appreciated by all the parties keeping aside political motives. Long term interest of nation should be foremost
- On what's next, he said that success of steps that the govt had taken and the positive response of the people to these in the first year 'have encouraged the govt to do even more'
