New Delhi: Apex industry body ASSOCHAM suggested the chairman of the Prime Minister’s Economic Advisory Council (PMEAC) to push ‘process reforms’ which are yet awaited to follow the policy reforms initiated way back in 1991.
“The process reforms are as significant as the second generation reforms to address the current prominent challenges faced by the Indian economy and must be fast-tracked,” said Mr Rajkumar Dhoot, president of The Associated Chambers of Commerce and Industry of India (ASSOCHAM).
"Spearheading the process reforms would help arrest India's falling economic growth, widening current account deficit, increasing short-term debt and public finance management which are posing serious challenges towards domestic economy," said the ASSOCHAM chief. “All the aspects of a policy process must be dealt in a single window approach and the administrative processes involved in the implementation of government policies need to be simplified and made coherent to result in minimum compliance burden.”
ASSOCHAM also urged the chairman, PMEAC to streamline the government processes considering that in the existing environment, even after getting clearance from the concerned ministry an industrialist has to go to different agencies for necessary support and that at times make the permission go unutilized.
“Management of the domestic economy is a bigger cause of concern at the moment as an uncertain global situation together with rising risk aversion and slowing capital inflows are posing grave challenges to India’s growth and balance of payments outlook but the Euro-zone crisis has a limited impact on the Indian Banking system,” said Mr Dhoot. “Fall in the GDP growth to 6.5 per cent during 2011-12 from 8.4 per cent in the previous year is one concern, but an acute fall in quarterly growth rates to a level of 5.3 per cent which is the lowest quarterly growth rate in past seven years, reflects the actual magnitude of this issue.”
“The domestic business entities seem to be in a fix with regards to both continuation and further expansion of their activities,” said Mr Dhoot. “There is a low business confidence amid Indian corporate sector considering subdued domestic consumption and investment demand, rising costs of inputs, deceleration in exports and constant risks from unhedged foreign currency which also has implications for the near and medium-term growth outlook.”
Meanwhile, the ASSOCHAM president also hailed the initiatives taken by the Prime Minister and said that measures to arrest the fiscal deficit, providing more clarity on tax related issues, creating avenues for productive investments and providing clearance to pending FDI (foreign direct investment) proposals and a slew of other administrative steps would go a long way to boost the investors’ confidence in India’s growth story.