Union finance minister P Chidambaram yesterday said there was a wide consensus in India to cut deficits, reduce tariffs and other import barriers and deregulate the economy faster in the country despite four governments being in power during the past year.
We have had four governments in the last 12 months but the basics of the new economic policy - driven by the zeal to reform - have not changed at all. If anything, each succeeding government has been at great pains to show that its reformist credentials are stronger than that of its predecessor, Chidambaram said, addressing the German Asia-Pacific Business Association here. There was also a general agreement on mobilising greater public and private investment in infrastructure industry, to decontrol and introduce competition in the financial sector and enhance investment in education and health, he said.
Stating that compulsions might have triggered the process of change, he said the people in India were no longer prisoners of compulsion.
The worst crisis is over, but the reforms wagon moves on, clearly demonstrating that it is conviction that is steering it forward, the finance minister told the audience at the Hamburg Chamber of Commerce.
Recalling Indias compulsion to liberalise the economy in 1991, Chidambaram said the country was faced with an unprecedented foreign exchange crisis and it was forced to make fundamental changes in the economic policies.
The six years since 1991 have been the most significant period of Indias post-independence history, he said.
India was changing since there was an aspiration leading the people to demand better quality of life. The first reason was that with three out of every five persons being born after 1960, there was an urge to seek better education, better and more jobs and higher incomes, he said.
India was also urbanising rapidly that by 2020 every second Indian would be urbanised, the finance minister said, pointing out that agricultural prosperity spreading to newer regions in the country was the root cause.
Farm growth is stimulating the growth of secondary and tertiary sectors and off-farm economic activity, he said.
Besides, proliferation of communications technology, emergence of new generation of entrepreneurs and change in polity of India, were also the basic reasons for the aspirations, he said.
The state governments were now the cutting edge of most reforms as they had been forced to adopt pragmatic and proactive policies towards private investment in the face of fiscal squeeze and mounting demands on the budget, he said.
