Tackle Fundamental Reforms, Stabilize Economy
To better understand the current macroeconomic situation and RBI‚Äôs action plan for managing the Current Account Deficit and currency volatility
Online PR News – 08-August-2013 – Mumbai – Tackle Fundamental Reforms, Stabilize Economy
Mumbai, August 07, 2013: To better understand the current macroeconomic situation and RBI‚Äôs action plan for managing the Current Account Deficit and currency volatility, Indian Merchants‚Äô Chamber invited Dr. Rajiv B. Lall, Executive Chairman, Infrastructure Development Finance Co. Ltd., on August 6, 2013 at IMC, Mumbai for an interactive meeting.
Presenting his thoughts while welcoming the august gathering, Mr. Shailesh Vaidya, President, IMC, observed, ‚ÄúThe current economic situation has seen a lot of volatility with the rupee crossing 61 to the dollar and stroking the inflationary potential of the economy while making the avowed aim of fiscal consolidation even more elusive. The GDP growth still remains in the danger zone.‚ÄĚ Apprehensive about the accountability in public life, which has touched rock bottom, he further stated, ‚ÄúThe country‚Äôs image in the international community is at stake and any credit downgrade now could prove costly for the economy.‚ÄĚ
Dr. Rajiv B. Lall, a respected name in the policy making and finance spheres, sports the right credentials and is a leading light in his own right, chairing the Global Agenda Council on Infrastructure of the World Economic Forum and; the Infrastructure Council of CII. He is also a member of their Economic Policy Council whilst being a member of the Managing Committee of ASSOCHAM apart from holding numerous other positions on the Prime Minister‚Äôs Committees on Infrastructure, Finance and Transport Sector development.
Sharing his vision on a long term perspective of the challenges facing macro policy formation, he said, ‚ÄúThe economy right now is not in an encouraging environment, it is suffering from a chronic fiscal problem. Historically, it has been observed that in a democracy with the introduction of universal suffrage, there is also prevalence of higher level of social spending, which in turn would increase the country‚Äôs GDP. However, to maintain this, would be a challenge for the Finance Minister of India. But to stabilize the economy, government needs to encourage corporate investment and public savings. This stability can be attained by measures like - Creating collateral equity markets; Addressing fundamental reforms; Tightening monetary policy.‚ÄĚ
The Oxford University alumnus was optimistic about India facing the impossible challenge of improving the fiscal condition, as he said, ‚ÄúIndia needs to design its own welfare measures and take advantage of technology, which can improve tax administration and the targeted disbursement of subsidies. On the other hand, citizens also need to be responsible and recognize the limitations of their system. My advice to the government would be to include the social sector and to create a productive private sector, which presently is not the case. I also look forward for the CPI inflation to come down but am skeptical about it.‚ÄĚ
Mr. Prabodh Thakker, Vice President, IMC, complimented Dr. Lall for his interesting and effective presentation as he said that Dr. Lall had offered positive and practical solutions to every problem posed.