Open purse-strings for $5 tn economy: Modi to investors

With private investments slowing down, Prime Minister Narendra Modi on Friday urged investors to open their purse-strings and take brave decisions to achieve the target of a five-trillion-dollar economy by 2024.

Modi, addressing the centenary celebrations of Assocham, also sought to reassure investors by telling them that he has brought under control the old weaknesses and expressed confidence that the economy would emerge stronger from the current slowdown.

“The country's economy has witnessed such ups and down previously as well. But every time the country has come out of the crisis and emerged stronger. Even now India will emerge stronger and chart its path forward with firmer determination and confidence,” the prime minister said.

In a subtle message to his critics, Modi said even during previous regimes, GDP growth had trickled down to 3.5% in one quarter, CPI had touched 9.5%, core inflation was at 7.3%, WPI at 5.2% and the fiscal deficit had touched 5.6% of the GDP.

“Several quarters were disappointing for the economy. But I don't want to get into that debate,” Modi said that he had never countered whatever has been said about the economy and only picked up the best suggestions that had been made.

The Prime Minister's remarks come at a time when economic growth has been slowest in the past six years in the quarter ending September. India's gross fixed capital formation, a measure of investment in the economy had fallen to a meagre 1 % in the September quarter as compared 11.8% in the same period last year.

Modi listed out labour reforms, ironing out problems in the roll-out of the GST, amendments to the Companies Act and encouraging banks to take bold commercial decisions as steps taken by his government to kick start the economy.

“I want to tell everyone associated with the banking and corporate sector that the old weaknesses have been ironed out. Take decisions bravely, invest openly, and spend well and keep moving ahead,” the prime minister said adding that genuine commercial decisions would not be viewed adversely.

Modi said that his government had also removed provisions in the Companies Act that sought criminal action against promoters for minor transgressions.