Government Willing To Go ‘As Far As Needed’ To Revive Animal Spirits, Modi Tells Economic Times
Government will continue to aggressively push public sector investment and accelerate project execution, said Modi.
The Indian government is willing to go “as far as needed” to revive the 'animal spirits' in the economy and make the private sector bullish, Prime Minister Narendra Modi said in an interview to Economic Times.
Demand in sectors like automobiles, real estate and mining will recover with the acceleration of economic growth, said Modi. “With capacity utilisation crossing 75 percent, we would see growth in investment from private sector in the coming months.”
At the same time, the government will continue to aggressively push public sector investment and accelerate the execution for these projects to ‘crowd-in’.Narendra Modi, Prime Minister (To Economic Times)
Monetary Policy Transmission
Modi said transmission of monetary policy is important, as cost and availability of credit are critical for businesses. The government is working closely with the Reserve Bank of India and the banking system to “remove blockages in the flow of credit, especially to small and medium enterprises,” he said.
We are also looking to remove all delays in government payments and tax refunds so that cash-flow in the economy revives.Narendra Modi, Prime Minister (To Economic Times)
Financing Investments
The government is working on policies for domestic and foreign sources for investment, including liberalising foreign direct investment norms and simplifying labour laws, Modi added. Measures such as asset monetisation, asset recycling and strategic disinvestment will help raise funds for public capital expenditure and boost growth and crowd-in private investment soon, said the prime minister.
Surplus liquidity in the international financial market provides an opportunity to access funds at lower rates, he added. “This makes lot of investment economically viable. All of us will agree that India needs investment in infrastructure.”