Thaindian News

On board Air India One, Dec 17 (IANS) In the back drop of corporate and foreign investors being miffed over the government suspending its decision on foreign equity in multi-brand retail, Prime Minister Manmohan Singh Saturday said his government will take up implementation of this policy next year after consultations with opposition parties once elections to various assemblies are over.

Manmohan Singh also said his government was committed to go moving forward with economic reforms, which were initiated under his stewardship as finance minister in the Congress government under then prime minister P.V. Narasimha Rao between 1991 and 1996.

However, he blamed “political compulsions” for the government taking such hard decisions to rollback or suspend policies.

“We have to evolve a broad-based consensus and we will work towards that. It’s my hope that once the elections to the various state assemblies, which are in the offing, are over, all political parties can sit together, and we will then explore with them the possibilities of implementing the decision, which is placed on hold,” he said.

Manmohan Singh was interacting with media persons on board his special aircraft while returning home from Moscow after attending a summit meet with Russian President Dmitry Medvedev.

Responding to the increasingly belligerent criticism of his government over suspended key decision on economic reforms, he said the UPA was “committed to reforms as ever”, but blamed the rollbacks and putting crucial decisions on hold to “political compulsions.”

“Our government stands committed to reforms as ever before. But there is such a thing as political compulsion. Given the nature of coalition… the fact that we, as the Congress party, do not have a majority (in parliament), we have to move at a pace whereby all our allies can be on the same page,” he said.

“Therefore that certainly restricts our options. But we are hopeful that some essential reform… we can still push through after we have engaged our allies in a constructive, productive dialogue,” he said, adding that “there is no other way in which we can move forward.”

Manmohan Singh was also sure that captains of industry recognised, as much as anybody else, what “the reality of political situation” in India is.

On the global economic crisis and its impact on India, he said there were “temporary setbacks”.

“There are temporary setbacks. We cannot be oblivious to what is happening in the world economy. The whole Eurozone crisis is something, which has global impact everywhere,” he said.

Noting that “everywhere, the growth impulses are taking a beating”, Manmohan Singh said he sincerely believed world economy required “concerted efforts on part of all major powers to bring back the rhythm of growth process.”

“I still believe that even if the world does not revert to the healthy growth path, in India, we have the ability and the will to push for a growth rate of at least 8 percent per annum,” he said.

Observing that India’s savings rate was as high as 34 percent and investment rate as high as 36.5 percent, the prime minister said unlike many other developing countries, including China, Indian economy was not that much dependent on international trade.

“Therefore, if we can increase investment in infrastructure, and create adequate domestic demand for capital goods, we have the ability to sustain a growth path of 8 percent and maybe of 9 percent in the next five years,” he added.