Are the decisions symptomatic or formative? Is the incumbent government eyeing 2014 elections or seriously trying to bring the economy back on track? Well the arguments may be numerous but whatever may come whether these steps collectively are capable of breathing new life into the system remains the critical concern.
After a long wait the government has finally started taking action on key policies, several bills and projects which were pending or standstill for quite some time.
The government has been able to pass the crucial -
- The Companies Act, 2013
- The National Food Security Act, 2013
- The Land Acquisition, Rehabilitation and Resettlement Act, 2013
The government and the RBI are apparently working in partnership to revitalize the investment.The Prime Minister also mandated FIPB to clear all pending applications for brown field pharmaceutical projects under the existing guidelines, in spite of recommendation of parliament committee to not to permit FDI in existing projects. The cabinet committee has also cleared project worth Rs 1.9 lakh crore in power, steel, road, port and other infrastructure sectors and has directed immediate environment approval as well as finalization of coal linkage wherever stuck. The Reserve Bank of India has announced several liberal initiatives including freedom to use External Commercial Borrowing from equity owners, private sector mobile valet and several other initiatives are in the pipeline. The import of gold has been restricted, outbound investment limited to 100% of net worth, Liberalized remittance scheme restricted to 75000$ p.a., permitting banks to borrow internationally up to 100% of NOF etc.
The fall of Indian rupee to a level of Rs 70/- to US Dollar has jolted the entire economy including bureaucracy, polity, political leaders, economists, industries, businesses and of course the Indian society. The economic terrorist attack has been severe and we are actually in an emergency situation warranting to take swift and deeper action.
The investors' confidence took a severe beating from Rs 5,500 crore Scam of National Spot Exchange
misusing commodity transactions for lending borrowing and ready forward. This is much larger than Harshad Mehta scam and Ketan Parekh scam. We are very hopeful that the government will take tough action against the guilty including those who allowed such an open misuse of the system, when the same was in common knowledge, in black and white in several representations to the industry bodies. The action should be exemplary to act as a deterrent for the wrongdoers in future and to revive the confidence of investors.
We wish Good Luck to the Indian Economy.