Stalled reforms will pick up by Oct, says Plan panel

Review of infra projects by July 15

The government has taken a number of steps to spur India’s slowing economy, which will start yielding results by October, Planning Commission Deputy Chairman Montek Singh Ahluwalia said on Tuesday. 

“By October, we will be able to say that we have achieved a definite target as far as reforms are concerned,” he told reporters after releasing a report, which lays emphasis on accelerated economic growth during the 12th Plan period.

In the absence of a clear direction from the government about policy reforms, many investors and companies, said to be sitting on a huge pile of cash, have apparently held back from investing in the country.

However, the assurance from Ahluwalia, considered close to Prime Minister Manmohan Singh, and who has played a key role in economic reforms initiated by Singh in 1991, is bound to have positive sentiments among the investor community, opine analysts. The Planning Commission is also expected to complete reviewing major infrastructure projects in the country by July 15 and send report to the Prime Minister’s Office, which is currently overseeing country’s economy.

A slew of policy issues and government inaction has hurt infrastructure projects across the sectors including road, port, power and the likes. Problems related to land acquisition, getting environmental clearances have led to several projects being shelved or stalled.

Unfortunately for the past few quarters, the number of stalled projects has gone up. Manmohan Singh, after taking over the charge of finance ministry late last month, had emphasised the need to push infrastructure investment in the economy.

The government has estimated investments worth over $1 trillion in the next five years to develop the country’s infrastructure with an equal participation from private players.

On whether the delayed monsoon could play a spoilsport on the economic expansion, the planning commission deputy chairman said, it was too early to reach a conclusion as the monsoon, which was weak in the first half, may recover in the later period. “Mere delay in the monsoon does not mean the whole monsoon has failed. Sometimes it is weak in the first half but pick up pitch in the second,” he said, adding that the government has enough food stock to take care of any supply shortage in the event of kharif crop being hit due to delayed monsoon.