Finance minister Arun Jaitley on Monday said he was in talks with opposition parties to ease some provisions of the land acquisition law and he would soon brief state finance ministers about a draft Constitution Amendment Bill on the goods and services tax as part of taking the Modi government’s reform agenda forward.
Jaitley said at the Citi’s Investor Summit that the government favours a cut in the key policy rates by the RBI as inflation, especially food inflation, has moderated in the last few months. Global fuel prices have also declined recently. The Wholesale Price Index rose an annual 1.77% in October, its slowest since September 2009.
“Therefore, if the RBI, which is highly professional organisation, in its wisdom decides to bring down the cost of capital, it will give a good fillip to the Indian economy,” he said. He said the government was working on several reform measures, especially in easing the land takeover norms.
Jaitley, who is in talks with state FMs on the proposed indirect tax regime, said most of the contentious issues have already been resolved. States in general want to retain their taxation authority in liquor and petroleum products, while two states want entry tax and octroi to be kept out of GST. Jaitley said these issues would be sorted out soon.
The Insurance Amendment Bill is expected to be passed in the winter session of Parliament, he said.
The FY15 divestment target is quite ambitious but is achievable, he said.