Age Comment: Govt must do more, not just look to RBI "RBI governor D. Subbarao’s call in Tuesday’s credit policy statement to initiate policies with a sense of urgency to bring down the current account deficit (CAD) to sustainable levels seems to have galvanised the government into action. Finance minister P. Chidambaram on Wednesday talked of a further boost to foreign direct investment while commerce minister Anand Sharma announced an immediate increase in interest subvention of three per cent from two per cent for exports. It is hoped that the government takes a more holistic and realistic view of the ground situation besides such sops. For instance, the infrastructure for exports has to simultaneously be put in place. Imports of luxury items, which along with engineering goods account for more than the value of gold imports, have to be made more expensive with stiffer import duties, even though the depreciated rupee should have increased the cost of imports. The government should also, without waffling, offer attractive incentives to foreign manufacturers of these luxury items to start production in India."
Posted on: Thu, 01 Aug 2013 11:16:05 +0000
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