Govt won't meddle with regulators' job

14-Jul-2010

The government will not interfere in the jurisdiction of the regulators," finance minister Pranab Mukherjee told reporters in Mumbai on Tuesday when asked about the RBI governor's remark that the ordinance on unit-linked investment plans (Ulips) raised regulatory concerns. Mr Mukherjee had come to Mumbai to launch an investor education initiative by UTI Mutual Fund, titled Swatantra. However, he did not take any questions from the press. Swatantra aims to create awareness among retail investors about financial planning and the benefits of investing in mutual funds.

Mr Mukherjee further said the government was working towards reducing the fiscal deficit, which had zoomed to 6.8% last fiscal on account of the stimulus packages rolled-out in the wake of the global financial crisis. "I do believe that it is not possible to sustain that level of fiscal deficit for a long period of time. I shall have to come back to the path of fiscal consolidation sooner than later," the finance minister said. The fiscal deficit in 2009-10 was estimated to be 6.8% of the GDP but the government is optimistic about bringing it down to 5.5% in the current fiscal and 4.5% in the year after, he said.

The government's aim is to quickly return to the 9% growth path and later to double-digit levels, he said. "Our objective is to ensure that we can come back to higher growth not for one or two year but on a sustainable basis for 7-10 years, till we come out of poverty and backwardness," Mr Mukherjee said. The government proposes to enact a National Food Security Act which envisages every citizen below poverty line entitlement to highly-subsidised foodgrains, he said. The FM also expressed displeasure at the inadequate credit supply for SMEs and asked Congressmen to help the sector grow.

Addressing a meeting organised by the Maharashtra Pradesh Congress Committee here in Mumbai on Tuesday, Mr Mukherjee noted that in the face of globalisation and increased competition from larger corporations, it has become imperative to ensure that all industries in a given sector have equal access to technology and market. While pointing out that the government has taken major steps to develop industries from the SME sector since the passing of the Micro, Small, and Medium Enterprises Development Act, 2006, the finance minister made it clear that he was still unhappy about the inadequate credit received by MSMEs.

Source : www.insuremagic.com