Finance minister P Chidambaram said on Saturday the Reserve Bank of India (RBI) had agreed to take forward the process of issuing guidelines for new bank licences. ?I have assured the RBI that we will introduce the Banking Regulation Amendment Bill in the winter session,? Chidambaram said at a press conference in the city. The central bank has been insisting that the Banking Regulations Act be amended so that it can be armed with powers to supersede the boards of banks in the event of any misconduct by the management.
The finance minister said the Shome committee report on the implementation of the General Anti-Avoidance Rules (GAAR) would be made public soon, adding the government was in favour of both pending disputes as well as anticipated disputes. Replying to a question on the Vodafone tax dispute case, Chidambaram said: ?We will make the report public, wait for feedback and would like a resolution of pending and anticipated disputes.?
The GAAR guidelines which were framed, as part of Union Budget for 2012-13 to check tax evasion had spooked foreign institutional investors (FIIs), who believe the taxation rules would be stricter and enforced with retrospective effect.
The minister expressed confidence that the bills on FDI in insurance and pension will be passed in Parliament, saying he would open a dialogue with opposition parties including the BJP. ?There is a difference of opinion, on one clause relating to the issue of 49% FDI in insurance. I intend to meet with the leaders of opposition and convince them that this is in the interest of the country,? the minister said, pointing out that several public sector banks which had insurance ventures needed foreign capital.
Chidambaram observed he was committed to channelising savings into investments, adding he was confident of achieving the Rs 30,000 crore disinvestment target for the fiscal.
In response to a question on allegations against Congress leader Sonia Gandhi?s son-in-law Robert Vadra, Chidambaram said transactions between two private individuals could not be questioned on basis of ?implied act of corruption.? ?In fact, what I have gathered is that these transactions are between two private individuals and they have been disclosed in the appropriate income tax and other returns,? he said.
The finance minister also said the industry has conveyed to the government that the economic situation was challenging and certain fundamental concerns apart from regulatory issues needed to be addressed. ?We will talk to regulators and we will try to resolve regulatory issues,? Chidambaram said, adding the industry had been supportive of measures taken so far and had asked for more steps to address fundamental issues.
?We expect that we will get back to the high growth path,? he said. The minister observed that while headline has been brought down from 10% to 7.5% thanks to steps taken by the government, there would be some short-term impact on the prices because of measures like diesel price hike. ?Some steps that we have taken will indeed cause in the immediate time frame a small rise in inflation. But in the period say 6-8 weeks inflation will come down,? he said.