Will sacrifice India for you: FM’s signal to foreigners
23 Jan 2013 5:31 AM IST
India has buried the 'ghost' of the General Anti-Avoidance Rules (GAAR), Finance Minister P Chidambaram said on Tuesday, asserting that there is no threat of a rating downgrade in view of key economic decisions like allowing FDI in multi-brand retail and hiking fuel prices. He said there is revival of investor interest in India as a result of a number of measures taken by the government since September. 'There is universal acknowledgement that we have handled the GAAR situation fairly effectively and buried the ghost that GAAR will be some kind of a monster,' he said.
Here on a day's visit for an investor conference, the Finance Minister said that investors raised issues relating to the provision of GAAR that was introduced in the 2012-13 Budget by his predecessor Pranab Mukherjee. GAAR gave unbridled powers to taxmen to check evasion of taxes by foreign investors that created huge apprehensions among investors. Last week Chidambaram announced that GAAR implementation has been postponed by two years to 2016. 'On specific questions on GAAR and I took some time in explaining all the measures we have made to GAAR and told them how market has received it very well here,' he said. Kicking off his campaign to woo investment, Chidambaram met over 200 top investors at the 'India for Investment Conference' organised by Citibank and BNP Paribas. He made a strong case for their investment, assuring that all their concerns were being addressed and that the government had gone out of its way to obey their dictats, including containing of the fiscal deficit.
'It is a very well attended meeting. Virtually everybody who is anybody in the financial sector is here including wealth funds, sovereign funds, banks asset management companies,' he said. 'At that at the end of this year, we will achieve the target of 5.3 percent of fiscal deficit and next year I will budget for fiscal deficit no more than 4.8 percent,' he said. He added that he explained to the international investors the number of measures taken in this regard. 'I thought it was a fruitful conference. I could get a sense of the concerns of investors. Happily many of the concerns were addressed in the last three of four months,' he said. Chidambaram said the investors were concerned about the rating downgrade.
'I think the steps we have taken assured everybody that there will not be a rating downgrade. They were concerned about our ability to stay the course after we announced the decisions. They are happy we stayed the course after announcing FDI in multi-brand retail,' he said.
He said that the investors and rating agencies were concerned that India would not increase fuel prices. 'But even the small steps we have taken have given them confidence that we will correct the fuel prices. I think each of the measures has boosted their confidence in the Indian economy,' said a visibly jubilant Chidambaram, proudly showing off the foreign investors' endorsement of the government's anti-people and anti-national economics decisions..
While the government had in September capped the supply of subsidised cooking gas and raised the price of petrol and diesel steeply, last week it had virtually begun the process of deregulation of diesel price. 'There is revival of confidence that we will stick to our promises to contain the fiscal deficit and lowering it by 0.6 per cent every year by the next five years,' he said.
Here on a day's visit for an investor conference, the Finance Minister said that investors raised issues relating to the provision of GAAR that was introduced in the 2012-13 Budget by his predecessor Pranab Mukherjee. GAAR gave unbridled powers to taxmen to check evasion of taxes by foreign investors that created huge apprehensions among investors. Last week Chidambaram announced that GAAR implementation has been postponed by two years to 2016. 'On specific questions on GAAR and I took some time in explaining all the measures we have made to GAAR and told them how market has received it very well here,' he said. Kicking off his campaign to woo investment, Chidambaram met over 200 top investors at the 'India for Investment Conference' organised by Citibank and BNP Paribas. He made a strong case for their investment, assuring that all their concerns were being addressed and that the government had gone out of its way to obey their dictats, including containing of the fiscal deficit.
'It is a very well attended meeting. Virtually everybody who is anybody in the financial sector is here including wealth funds, sovereign funds, banks asset management companies,' he said. 'At that at the end of this year, we will achieve the target of 5.3 percent of fiscal deficit and next year I will budget for fiscal deficit no more than 4.8 percent,' he said. He added that he explained to the international investors the number of measures taken in this regard. 'I thought it was a fruitful conference. I could get a sense of the concerns of investors. Happily many of the concerns were addressed in the last three of four months,' he said. Chidambaram said the investors were concerned about the rating downgrade.
'I think the steps we have taken assured everybody that there will not be a rating downgrade. They were concerned about our ability to stay the course after we announced the decisions. They are happy we stayed the course after announcing FDI in multi-brand retail,' he said.
He said that the investors and rating agencies were concerned that India would not increase fuel prices. 'But even the small steps we have taken have given them confidence that we will correct the fuel prices. I think each of the measures has boosted their confidence in the Indian economy,' said a visibly jubilant Chidambaram, proudly showing off the foreign investors' endorsement of the government's anti-people and anti-national economics decisions..
While the government had in September capped the supply of subsidised cooking gas and raised the price of petrol and diesel steeply, last week it had virtually begun the process of deregulation of diesel price. 'There is revival of confidence that we will stick to our promises to contain the fiscal deficit and lowering it by 0.6 per cent every year by the next five years,' he said.
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