Mumbai, June 16: As he gets ready to move to Raisina Hill, Union finance minister Pranab Mukherjee today had some encouraging words for India Inc, which has been critical over the policy paralysis at the capital.
Mukherjee today said even as the Centre was doing its bit to bring the economy back on growth path, the Reserve Bank of India could also lower interest rates.
A day after he was nominated as the Presidential candidate, Mukherjee today said the Centre had been taking various steps to address concerns expressed not only by Corporate India, but also international credit rating agencies to dispel the recurrent talk of policy inaction by the Centre and the North Block.
Addressing a seminar organised by Assocham, the finance minister said he was aware of the challenges India was facing and expressed the optimism that measures taken by the government would yield results soon.
"As finance minister, I cannot ignore the ground realities and areas of difficulties and also the apprehensions expressed sometimes by captains of industry, sometimes by credit rating agencies. As finance minister, I do not dismiss their concerns. I take serious note of their concerns and try to find out what is to be done, that is the exercise which I have done all three years starting from January 2009,'' he said.
The finance minister also had a word of advice for India Inc. Admitting that there was a "negative sentiment'' when it came to investment, he said the country had to find its own solution to the problem.
"My only request to leaders and captains of industry is that we should take note of these areas of difficulty, but we will have to find our own solutions. I believe industry has the resilience, the economy has the resilience and we are competent to rise to the task of meeting grave challenges,'' he said.
Mukherjee further expressed the hope that the Reserve Bank would bring down interest rates to stimulate the economy.
The RBI is set to announce its mid-quarter review of the monetary policy on Monday and it is widely expected to bring the policy rate at least by 25 basis points.
"I am confident that keeping in view all the factors, the RBI will adjust the monetary policy as we are adjusting the fiscal policy," he added.
Rupee volatility
Expressing concern over rupee volatility, Mukherjee today said there was an urgent need to diversify the country's export markets.
"The volatility of the rupee is still a matter of concern. And in the context of the current account deficit and going by the slow exports growth, (this) clearly demands that we must diversify our export destination and also our export basket," said Mukherjee.
He added that there was a need to encourage people to invest in market instruments. The minister regretted that people were investing in gold with the expectation that the value of their investment would appreciate. "Quantum of import of gold ... is a clear indication (that) large section of community...want (to) investment in dead asset only with expectation that its value would appreciate," he said.
Finance expert Martin Lewis secures TV deal - Daily Record
Greece votes to decided whether to stay in the eurozone - Daily Telegraph
Opinion polls show Greeks, weary after five years of deep recession, overwhelmingly favour remaining in the euro, but there is bitter anger over repeated rounds of tax hikes, slashed spending and sharp cuts in wages.
Many voters are also furious with New Democracy and the other traditional ruling party, the now severely weakened PASOK, blaming them for decades of corruption, waste and inefficiency.
"It's the first time I feel depressed after voting, knowing that I voted again for those who created the problem, but we don't have another choice," said 66-year-old English teacher Koula Louizopoulou.
"I voted for the bailout because these are the terms that will keep us in Europe," she said.
A win for Greece's national soccer team in a game on Saturday at the Euro 2012 championships provided some lift for voters but there was little sign of enthusiasm at the polling booths, which close at 5pm UK time. Exit polls will follow soon after voting ends.
"It's obvious the country is now staring into the abyss," leading Greek daily Kathimerini said in a front-page editorial on Sunday, calling for the creation of a New Democracy-led "unity" coalition to keep the country in the euro.
The party gaining the most votes wins an automatic 50-seat advantage but neither New Democracy or Syriza is expected to win an outright majority and whoever emerges as top party will have to hold coalition negotiations with smaller groups.
European leaders weighed in on the eve of the vote - a re-run of an earlier election on May 6 that produced no clear winner - some of them openly urging Greeks to reject SYRIZA or risk undermining the very foundations of the single currency.
But whoever wins power may find their tenure is short-lived and, despite the insistence of EU politicians, some adjustment of the bailout terms may be inevitable if Greece is to cut a public debt amounting to 165pc of gross domestic product.
"It is a scenario I see as likely and if that is the condition presented for Greece to stay and then move on, I would say it is probably something that should be attempted," Angel Gurria, head of the Organization for Economic Cooperation and Development, told Reuters in an interview.
Central banks from Tokyo to London are readying arsenals to defend banks and national currencies against any post-election turmoil. The result will dominate a meeting of the Group of 20 world economic powers on Monday and Tuesday in Mexico.
Finance officials in the eurozone have discussed limiting the size of withdrawals from ATM machines, imposing border checks and introducing eurozone capital controls as a worst-case scenario.
Eurozone officials have hinted they might give a new Greek government some leeway on how it reaches debt targets set by the EU/IMF bailout package, but there would be no change to the targets themselves.
Eurozone paymaster Germany warned Greeks on Saturday the bailout would not be renegotiated.
"That's why it's so important that the Greek elections preferably lead to a result in which those that will form a future government say: 'Yes, we will stick to the agreements'," Chancellor Angela Merkel told a party conference of her Christian Democrats.
A Greek exit from the single currency would heap further pressure on two far larger European economies - Spain has already received up to €100bn to save debt-riddled banks and Italy could be next to seek a bailout.
Anger with the establishment parties New Democracy and PASOK propelled Syriza and its youthful leader, a former Communist student protest organiser, from the obscure radical fringe to a shock second place on May 6.
The far-right Golden Dawn party also won seats in the first election, underscoring the fragmentation of a stressed society wrestling with unemployment of almost 23pc and plummeting living standards.
Five years of recession and more than two years of acute crisis have started to fray the edges of Greek society, undergoing its severest test since the overthrow of the military dictatorship in 1974.
The streets of central Athens are scarred by repeated waves of protests, some hospitals are short of vital medicines and reports of suicides caused by the crisis have become routine.
Five opinion polls published before a blackout two weeks ago put New Democracy narrowly ahead. Two other polls had Syriza leading.
But analysts say Samaras, 61, will find it hard to govern for long with an empowered Syriza protesting at the gates. Tsipras, if he wins, will inherit a country on the verge of bankruptcy. He has ruled out a government of national unity and promised to nationalise banks and halt privatisations.
Some global businesses and banks are already in retreat.
Europe's biggest retailer Carrefour said on Friday it was selling up in Greece, a day after French bank Credit Agricole moved to take direct control of its Albanian, Bulgarian and Romanian units from its Greek bank Emporiki.
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