Barely three days ago, Mr Sinha had declared at a book release function here that he was "not worried" about recent complaints from sections of the industry about an economic downturn.

After the first-ever mid-year economic review with representatives of the industry, Mr Sinha came down from his "I am not worried" platform to recognising that there are problems cropping up in critical sectors which require urgent attention. Accordingly, he has convened a second meeting next week to discuss specific policy options.

The Finance Ministry officials believe that pushing through major public sector projects and economic reforms initiative can revive the sentiment and growth prospects in the economy. It is reliably learnt that the Finance Ministry is concerned at the slow progress of several public sector projects. The unanimous opinion of the presidents of three apex industry bodies -- the Federation of Indian Chambers of Commerce and Industry (FICCI), the Confederation of Indian Industry (CII) and the Associated Chambers of Commerce and Industry (Assocham) -- at the meeting that key manufacturing industries such as cement, steel, automobiles, textiles, capital goods and chemicals were the worst affected put across the message to Mr Sinha, according to a prominent industrialist who was present at the meeting.

That the finance minister was concerned at the issues raised by the industry representatives and was keen to resolve them was evident from the fact that the meeting lasted for more than two hours against the original schedule of one hour and Mr Sinha asked the industry representatives to meet him again next week with concrete and specific suggestions.

"The finance minister told us honestly that there are confusing signals on the performance of the economy. While some industrial sectors are doing well, some are not. There is a contradiction of macro economic data. This is why he wants us to suggest industry specific measures to revive growth," another industrialist told The Financial Express.

FICCI president GP Goenka said, "I think it was an excellent decision to review the economic situation after six months. Now having heard everything we will make specific recommendations and submit them to the finance minister within a week."

In his presentation at the meeting, Mr Goenka raised the issue of anti-dumping measures used by the US and European countries against Indian imports, increase in investment in infrastructure sector, increase in public spending by the government, immediate introduction of value-added tax, direct action against manufacturers of spurious products which was hurting organised sector and government revenues and a calibrated approach to custom and excise tariffs based on the disadvantages which the industry faces in terms of transaction costs, interest costs and power costs as compared to foreign companies which are exporting goods to India.

FICCI has also suggested setting up of a government-industry task force to look at sustainable agriculture growth. He said ensuring good agriculture growth was important as industrial growth was directly linked to performance of the agriculture sector.

CII president Arun Bharat Ram said, "There are many sectors which have slowed down, particularly the manufacturing sector. Power and power-related industry is one sector and a strategy has to be evolved to accelerate growth. There is no easy solution, we have to work on a concrete long-term plan."

According to Assocham president Shekhar Bajaj, a sharp slowdown in growth of capital goods sector to 0.3 per cent during April-July this year from 11.6 per cent in April-July 1999 is the main reason for the fall in overall industrial and manufacturing sector growth rates.

Besides Mr Bharat Ram, Mr Bajaj and Mr Goenka, CII vice-president Sanjiv Goenka, HDFC chairman Deepak Parekh, IDBI chairman GP Gupta, ICICI managing director KV Kamath, FICCI secretary-general Amit Mitra, CII director general Tarun Das and Assocham secretary-general Jayant Bhuyan also attended the meeting.

Finance secretary PG Mankad, secretary in the department of economic affairs EAS Sarma, chief economic advisor in department of economic affairs Shankar Acharya, secretary in the department of industrial policy and promotion Ajit Kumar, special secretary in the department of economic affairs P K Banerjee and senior economic advisor in department of economic affairs Dr Arvind Virmani were also present.