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Hyderabad, August 29: The central government, in a bid to boost the capital markets, has decided to commence infrastructure development works in areas including roads, sea and airports from September as proposed in the budget, finance minister Yashwant Sinha said. Apart from budget allocations for infrastructure projects, the augmented funds from the Resurgent India Bonds (RIB) will be utilised for the purpose, Sinha said. Through these bonds State Bank of India has generated about $4billion within 14 working days, he added.
While finding fault with RIB critics, the finance minister said that along with the finance ministry the RBI is working on a scheme to facilitate easy repayment at maturity without burdening the country. However, he reminded them that since 1991 India has never defaulted in its commitments to international creditors.
Speaking at a meeting organised by the Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI), Sinha said the commencement of these works would mean demand for products from core sectors like cement and steel whose performance has slowed down due to the slowdown in the economy. This will have a chain reaction on the markets, as the core industry's performance will improve and the capital markets will have to react to it, he said.
"I am unable to fathom the reason for the low market sentiment despite certain other sectors performing well," he added. He asked industrialists to come forward to set up different projects and assured speedy processing at the government side. He said that financial reforms will be speeded up under the present government and revolutionary decisions such as divestment of PSU shares, delicensing of sugar industry would be carried out keeping the overall growth of the economy in view.
On small and medium sized NBFCs operating in the country, the finance minister expressed the need to support them. He said baring a few black sheep a majority of the NBFCs in the country have performed well. The committee set up to study the working on the NBFCs is expected to submit their report in the mid-September and only then the government will take a decision, he said.
In response to the FAPCCI president Laxminiwas Sharma's suggestion, the finance minister has accepted to establish tax payer committees at every commissionerate of customs and income-tax. Chief minister N Chandrababu Naidu has sought the support of the finance minister in all the projects that the state is taking up.
Sinha asks income-tax officials to spruce up act
Finance minister Yashwant Sinha has sought the help of central excise and income tax officers in maintaining the fiscal deficit below the budgeted 5.6 per cent and meeting the expenditure targets as proposed in the budget. Speaking at a review meeting organised by the departments of customs, central excise and income tax at Hyderabad, Sinha exhorted the officers to achieve their targets by putting in extra effort despite difficulties faced by some industrial sectors due to the economic slowdown.
The finance minister is in the city as part of his two-day visit to review the revenue collections and motivate officers to improve upon the targets. Targets fixed in the budget are more realistic and are achievable, he said. Reaching these targets are a must to build confidence among the foreign investors who are looking towards India for making major investments, he added. Considering the global economic slowdown, the major countries are now diverting their funds to India and to retain these investments it is necessary to keep the home in order first, he said. Achieving the revenue targets will make it possible to maintain the present level of fiscal deficit, he added.
Sinha said, despite knowing that the growth in certain industrial sectors have slowed down, revenue targets have been fixed with the belief that they can be met with vigorous drive. The economy will make a turnaround in the later part of this year, he said. For fiscal 1998-99, the Hyderabad zone has been set a target of Rs 4,089.30 crore via central excise, while the target for the customs department is Rs 1,560 crore. However, as on July 31, the zone was able to collect central excise of Rs 1,082.32 crore and customs Rs 350.34 crore.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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