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In what could be a clear signal to the Reserve Bank of India (RBI) ahead of its mid-quarter monetary policy on June 17, Prime Minister Manmohan Singh said today he believed the central bank would have more space available to pursue pro-growth policies, as inflation was coming under greater control.
Asked whether RBI was behind the curve in the growth versus inflation dynamics, Singh said he "respects the judgment of the central bank, which decides the monetary policy. But this is an evolving process. In the coming months, you will see inflation come under greater control and the space for growth-promotion activities will also increase". This is the first time that the Prime Minister has publicly expressed his views on the issue.
The Prime Minister, who was speaking to reporters on his way back from his five-day tour of Japan and Thailand, did not directly comment when asked about his opinion on the finance minister's observation a few months earlier that he would walk alone on the growth path if others didn't want to see the obvious. The central bank has been moving cautiously on rate cut due to perceived inflationary risks. In its last review, RBI had cut the key policy rate by 0.25 per cent.
Singh, who was in a visibly good mood after a reasonably successful tour, answered a host of questions ranging from the Indian Premier League cricket scandal to the perception of a rift between him and Congress President Sonia Gandhi.
Asked whether the Congress would be open to an alliance with the Left parties or even Mamata Banerjee after the Lok Sabha elections in April 2014, the Prime Minister said it was his firm belief that "there are no permanent enemies or permanent friends in politics. Some people come in, some go out. I think they have to be accepted as they are". He ducked a question on whether he would be interested in continuing in his present job if UPA-III comes to power.
On the Indian Premier League scandal that has involved several politicians across party lines, the Prime Minister said "politics and sports should never get mixed up". Asked if the government was contemplating intervention in the spot-fixing issue, Singh refused to comment, saying the matter was still under investigation.
He rejected suggestions of a difference of opinion with Congress President Sonia Gandhi on several issues, including the resignation of former Law Minister Ashwani Kumar whom he had initially defended. "I can only tell you in all truthfulness that there is no difference of opinion between me and the Congress President. Where consultation is needed, I consult her. We work together on almost every issue. There is therefore no truth in the perception (of a rift)," he said firmly.
On the logjam in Parliament which has blocked several pending Bills, Singh said all possible efforts were being considered, including a special session of the Lok Sabha, though no final decision had been taken. "All political parties must help in this process," he said.
Singh took a dig at the Opposition, saying "they never expected UPA to win the elections for the second time and hence have taken an obstructionist role". Pointing out that there is "perfect continuity between UPA-I and UPA-II, he said he wished the Opposition had been more responsible. "I immensely regret that fact that essential business could not be transacted because of this approach (on the part of the Opposition parties)."
Singh said he conveyed his congratulations to Nawaz Sharif on the very first day the election results were coming out and reciprocated his sentiments that India-Pakistan relations should move forward. "I invited him to visit India. He also invited me to visit Pakistan but there is still no firm decision on the date of the visit on either side. Both of us are determined to deal with all outstanding issues in a peaceful manner," he added.
On his re-election from Assam as a Rajya Sabha member, Singh said he had the great privilege to represent the state since 1991 and had tried his best to serve the people in Assam. "Since I have been given another opportunity, I will serve the state with renewed dedication," he added.
On whether the Centre would consider more subsidies for the industries in northeastern states, the Prime Minister said while he agreed there was perhaps a need for some more items to be subsidised, industry in these states must also learn fast to stand on its own feet. The proposed trilateral highway between India, Myanmar and Thailand would help north-eastern states in a big way, Singh said.
On a possible Cabinet reshuffle in view of nine vacancies that includes the latest resignations of Railway Minister P K Bansal and the law minister, the Prime Minister said filling up of some vacant seats were being considered but no final decision had been taken as yet.
He refused to give any specific timeframe on when the six-month-old President's Rule in Jharkhand would be lifted, as the matter was still under consideration. Singh said he was more than happy with his trip to Japan and Thailand that saw concrete progress being made on a host of bilateral and strategic issues. He expressed the hope that a civil nuclear cooperation agreement with Japan, hanging fire for some time, would be formalised "before long".
He said the government's Look East Policy, a brainchild of his predecessor Narasimha Rao, had been paying rich dividends. There were enormous opportunities waiting to be tapped and the relationship with several South East Asian nations, particularly Asean, has reached a stage where large-scale trade flow will emerge. For example, he mentioned the Delhi-Mumbai Industrial Corridor and the Dedicated Freight Corridor which have got generous assistance from Japan. The Mumbai-Bangalore corridor had also drawn huge interest from investors in countries such as Japan, Thailand and Malaysia.
