NEW DELHI: Leading Indian in dustrialists has urged the new government, which took over the reins of the country last week, to take bold and innovative measures to bring the country out of its present economic malaise.
The industrialists, who include Ram Krishna Bajaj, L M Thapar and Kulwant Rai are unanimous in their view that there is no alternative before the country but to go in for a much larger IMF loan to solve the balance of payments problem.
Bajaj is of the view that “the full- scale economic crisis with which the government is faced needs to be tackled on a war footing”. Besides loans from IMF and other international financial institutions “we will have to make radical departure from past policies that have made our economy over- regulated and high cost,” he says. Kulwant Rai says in a statement that all the political parties ad- mitted that “the country is passing through the worst economic and political crisis”, The opposition will, therefore, not oppose the government if it takes strong economic measures to bring the Country out of the current impasse, Rao is of the view that the country needs 10 to 15 billion dollars of IMF and other foreign loans, “Piecemeal foreign assistance will not be able to bring us out of the balance of payments crisis”, He has also used the government to remove all impediments to the growth of industry, by removing most of the controls and deliquescing of industries, except in a few sectors and making drastic changes in the foreign exchange regulation act (FERA) and the mono polices and restrictive trade Practices act (MRTP).
Thapar says “liberalization process initiated in 1985 has not really taken off. Shackles of MRTP and FERA are still there. The MRTP limit should be altogether removed. Direct foreign investment should be liberalized to accelerate the flow of foreign equity and technology”.
He calls for bold and innovative Measures to reduce budgetary deficit, Among the measures Suggested by him are opening of More and more areas to private investment, privatization of selected Portable PSUS, reduction of government expenditure, private sector participation in power generation, oil exploration.
Article extracted from this publication >> July 5, 1991
