|Minister of State for Finance Jayant Sinha at 39th Skoch Summit in New Delhi.|
The generational shift in India’s economic reforms is taking place, with the NDA government working on the third generation of reforms, Minister of State for Finance Jayant Sinha said at the 39th Skoch Summit.
Speaking at the concluding ceremony of the two-days conference organised by the Skoch Group that debated the theme ‘From Dole to Development', Sinha said catalysing competitive federalism, global competitiveness, infrastructure development and innovation are the four important facets of the third generation reforms the government is intent on advancing.
The minister, who had been busy piloting important legislations in the Budget session of Parliament, said the seeds of the big transformation the government is embarking on were carried in the Union Budget. It contained 18 or 20 bold ideas in the Budget and in a nutshell, they all conveyed the message that the moment for launching the third generation reforms has arrived, he added.
“Competitive and cooperative federalism is the way India should move forward, given the complexities of governance and development challenges in India. Global competitiveness is the only way forward for the country to stay relevant as an emerging market economy that avoids the middle-income trap. Infrastructure development is the third, and we are putting large amounts of money to this area, which had been chronically starved of investment. The final idea is an innovative India, which would encourage wave and wave of innovation and build the foundation of a vibrant domestic venture capitalist culture,” he added.
He underlined the government’s focus on forging not just a strong, but a smart economy. “This is what we mean by the next generation of Swadeshi reforms. An economy that is creative in all respects – strong and smart; competitive and innovative; relying on the inherent strengths of India while welcoming foreign investment and fresh ideas,” he added.
Asserting that the first wave of financial reforms were launched in 1990 when his father, Yashwant Sinha, was the Finance Minister in the short-lived Chandra Shekhar government of 1990-91, Sinha as a student of India’s economic history, he read all the 25 Union Budgets since the country liberalised its economy. “What I could understand after a careful study of all these Budgets was that barring a few, all these budgets reflected a remarkable burst of policy-making. In the second generation reforms, two of the gold standard budgets were those of 2000 and 2001, which Yashwant Sinha announced. If you study those, you will recall how extraordinary and remarkable those were” he added.
“Now the history repeats itself. In 1998, when the NDA came to power, India faced a large fiscal and current account deficits. Policy-making was ground to a halt. More than that, India had lost the confidence of the world in terms of its ability to pursue macroeconomic stability and broader economic reforms. In 2014, when the NDA formed government again, we faced similar situation. However, we are determined to move forward the reforms process, just as the Vajpayee government did in 1998,” he added.
He said prudent fiscal policy will continue to be a priority for the government. In the Budget session of Parliament, he said, the government was successful in passing the insurance, mines and coal allocation bills. “If you consider it, my father proposed a Bill that would enhance the FDI limit in insurance to 49 per cent in 1999 when he was the Finance Minister, but it’s now that we could pass such legislation. We value the wisdom of liberalising the economy and to bring the task forward from where it was left off,” he stressed.
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