Cautioning against any complacency over the Indian economy being "single bright spot" in a volatile world, a top Finance Ministry official today said the key challenge for the government is to revive demand and push growth.
Pitching for an investment-driven demand revival, the Department of Economic Affairs Secretary Shaktikanta Das said government is not looking at any fiscal stimulus to effect this revival in demand due to resource constraints.
"The biggest challenge before us now is to ensure revival of demand in the domestic market in the context of different uncertainties world is showing," Das said at an event here.
He made it clear that the revival will not be through fiscal expansion, and the government wants it to be "investment driven".
The remarks come a day before RBI announces its latest monetary policy review, with Governor Raghuram Rajan being under tremendous pressure to cut rates to stimulate the GDP growth, which dipped to 7 per cent in the June quarter.
Das said the government is committed to providing enabling environment for the investments to come and the investment decisions get actualised quickly through its measures on ease of doing business.
The Finance Ministry is at present mulling a scheme under which opening of branch or project offices by foreign cos gets simpler and will be announcing it shortly, he said.
He further said the government is committed to introducing a series of reforms which is a "24x7 exercise" and does not wait for the Budget.
The reforms are aimed at upping the growth trajectory to beyond 7.5 per cent expected this fiscal, he added.
Das said that with volatility across the world, India is the "single brightest spot", but cautioned against being complacent at being at this exalted position.
"With this kind of uncertainty prevailing (world over) and India becoming a bright spot, we should not...Become complacent," he said, adding that the global volatilities are putting our currency under pressure and also impacting the markets.
RBI will soon be announcing a scheme for floating rupee- denominated bonds overseas shortly, he said.
Das was speaking at the event mark the merger of commodities regulator FMC with capital markets watchdog Sebi.
"It was mentioned earlier that there will be more regulation (because of the merger). But sometimes, more regulation need not necessarily be intrusive, it can be very benign," he said.
