India needs a more open economy for growth, Finance Minister P Chidambaram asserted Tuesday and sought the opposition's support for the government's reforms programme, saying the country cannot afford to grow at less than 8 percent.
"India needs a more open economy to seed growth. India needs more reforms and less economic restrictions," Chidambaram said, replying to a debate in the lower house of Parliament on the current state of the economy.
He said there was "no political consensus" on problems affecting the economy and that political parties should agree on "a common economic programme" on how to mitigate economic woes.
"The polity needs to agree on a basic direction of policy-making," he stressed.
The finance minister expressed hope that the recent measures taken by the government would help revive economic growth that slumped to a decade low of 5 percent in the financial year ended March 31, 2013.
He said India can't afford to grow less than 8 percent - the average growth rate achieved between 2003 to 2008.
"The prime minister and I both agree that India cannot afford to grow at less than 8 percent."
The finance minister's observations came after opposition parties slammed the government for mismanaging the economy on a day when the rupee touched a historic low of 66 against the dollar and the Sensex sank nearly 600 points.
"Rupee is tanking but government, Chidambaram keep saying All Izzz Well," said former finance minister and BJP leader Yashwant Sinha, asking the government to resign and go for early elections.
"Paralysis of decision-making is the problem," Sinha said, adding the government had lost control over the economy.
Opposition leaders cited rising prices, slowdown in growth and depreciation of rupee among the serious problems facing the economy and said the government's policies had created uncertainty and despondency in the country and that
In his response, Chidambaram blamed the US Federal Reserve for the recent slump in the value of rupee and volatility in the stock markets.
"On 22nd May 2013 an unexpected development caused tremors in every emerging economy when the US Fed announced they were considering rolling back quantitative easing," he said.
On current account deficit, Chidambaram said the government was determined to contain it at $70 billion.
According to the finance minister, the fiscal deficit will be contained at 4.8 percent of the country's gross domestic product.
"Will do everything in my power to contain fiscal deficit at 4.8 percent," he said.
Referring to the government's recent decision to impose duty on television sets brought from abroad as personal luggage by travellers, he said it would give a boost to domestic manufacturing.
"We have capacity to manufacture TVs in this country but millions of TVs find their way into the country as personal baggage. I have no issues with TVs coming as personal baggage but then you must pay duty on it. What is wrong with it. If millions of TVs don't come here, millions will be made in the country," he said.
