Govt to fast track pension, banking, insurance reforms

Decision on allowing FDI in retail could be taken if there is a political consensus

PTI | September 26, 2011



Government may push for some early action on enactment of crucial economic legislations like the pension reforms and banking and insurance bills in India after investors and CEOs in the US expressed concern over the delay in their adoption.

This indication was given by finance minister Pranab Mukherjee who also made it clear that a decision on allowing FDI in retail could be taken if there is a political consensus.

Talking to reporters after an unusual meeting with prime minister on a foreign soil to discuss domestic issues, the finance minister said the meeting became essential because he had to brief the prime minister on certain important discussions he had with Fund-Bank (IMF- World Bank) officials, the US-India Business Council, Investors Forum and CEOs and to initiate action at the government as a follow-up measure.

"First of all I am eager to get certain legislations passed by Parliament. One of the legislations -- Pension Regulatory Development Authority Bill -- has gone though the first stage of parliamentary standing committee. A lot of people have shown interest in making investment (in India).

"Between now and the winter session of Parliament, there is not much time so I thought I will talk to the prime minister to get his ideas. The banking amendment Act and the insurance amendment act raising the ceiling cap from 26 per cent to 49 per cent are important issues I discussed at length with the prime minister," he said.

Mukherjee said, "They (investors) expressed their concern. They are worried about the delay in legislation. When the CEO forum was launched, they were enthusiastic. When we talk to them, these are issues we are discussing."

He said "Parliament is Parliament and it has its own way of working. They said what is possible please execute."

To a question, he said, "allowing FDI in retail can be done if we can create a consensus. If there can be broad consensus about FDI in retail then we can take some action."

Asked if the American investors and CEOs were not happy over the civil nuclear liabilities legislation passed by Parliament, Mukherjee said it came up during discussions that the provisions did not meet the requirements of prospective investors.

"I explained to them that this was a compromise legislation which we have achieved with cooperation of the opposition parties. It would be difficult for me to go for another amendment. I will try to meet concerns as far as possible while framing the rules."

During the discussions with bankers and others, Mukherjee said there was a growing worry about the possibility of the world getting into a "double dip" recession.

"Everybody is worried about the second economic crisis in the world, whether there will be double dip recession. If the double dip recession takes place, are the instruments available with the policy makers enough."

He said yesterday he was elected chairman of the G24 after a gap of 28 years in 1983 when also "accidentally" he was the Finance Minister.

Denying reports that he had cut short his visit to Washington, Mukherjee said he had completed all the engagements there and had only preponed his journey to New York for his flight back home today.

Mukherjee said if the prime minister had left New York on Sunday morning, he would not have come here last night. Since the prime minister was here he thought he would brief the Prime Minister on certain important bilateral discussions he had with his US counterpart, India US Business Council, CEOs forum and Investors Forum since some action should be initiated.

Mukherjee said he would be leaving for his home in West Bengal for the 'Durga Puja' period soon after he lands in Delhi tomorrow. He also had discussions with leaders on the currency crisis.

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