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FM allays fears of multinationals

Newly-appointed Union Finance Minister Yashwant Sinha today reiterated that multinational companies had nothing to fear and promised to streamline procedures to facilitate larger investments in infrastructure and the core sectors.

Briefing newsmen soon after assuming office, Sinha clarified that the government had clearly spelt out the areas in which investments were welcome. 'The government would be totally transparent in dealing with foreign companies and other matters, and there would be no ambiguity," he said.

The government would clearly define what it meant by priority and consumer goods sector relating to investments by the foreign companies. "We will reduce the hassle factor with regard to foreign and domestic investments," he added.

The finance minister favoured presenting an early budget so that the benefits accrue in the current year itself. He said an urgent need was to reverse the slowdown in the economy by stepping up both public and private investments, specially in infrastructure, for imparting necessary dynamism into the economy.

He promised to hold a meeting with his counterpart in the commerce ministry to find ways and means to improve foreign trade, especially stepping up exports.

Sinha said the government would soon come out with the package relating to foreign trade to boost exports.

On the rupee value in the international market, Sinha stated that he preferred a stable rupee as currency devaluation was only one of the inputs for increasing exports. He said he would hold discussions with the Reserve Bank of India in this regard and added that India should not find itself alongside other Southeast Asian countries that had a run on their currencies.

The finance minister declared it would be his endeavour to ensure that the balances in the budget are restored as quickly as possible. It was important that the shortfall in the revenue receipts was reversed and the imbalance between revenue and capital expenditure replaced by a more equitable balance. By doing all this, the government could increase its expenditure in the core sector.

Stating that all was not well with the Indian economy, the finance minister stated there was a marked slow down in various areas resulting in the decline in the growth rate. "The urgent need," he insisted, "was to increase spending in both private and public sector specially in infrastructure sector to arrest the slow down.

Sinha said the economic challenges were many and the new government headed by Atal Bihari Vajpayee would meet these effectively. "Our objective is to ensure that we give this country within the shortest possible time an economy which is thriving, buoyant and which can hold on its own in the world arena," he declared.

He mentioned that the BJP and its allies had set out their objectives clearly in the national agenda. Sinha announced that he would be holding discussions with the officials concerned in the finance ministry on this aspect.

He said the government was determined to go in for consensus not only with the political parties but also with trade and industry. He would hold discussions with representatives of the cooperative sector, agriculture, industry, and other interest groups which played a vital role in the economy. "We proceed on the basis of national consensus not merely within the government but also outside," he added.

The finance minister stated that it was his government's "clear view" was that the reform process initiated in 1991 was a step in the right direction. However, he added that in sequencing the reform process, certain essential aspects were overlooked and the result was that the reforms could not deliver in the manner that it was expected to. "The process needed to be resequenced and corrected wherever necessary," he added.

Sinha, who was finance minister in the Chandra Shekhar cabinet, insisted that there was no fight among his colleagues over the finance minister's portfolio. "Who is fighting whom I don't know," he remarked, adding that as far as he was concerned, he had arrived in New Delhi on the night before the swearing was to take place and there were no problems.

The finance minister scotched rumours about changes among the top bureaucrats in his ministry.