Chidambaram promises fresh action in October to boost economic growth

The government proposes additional measures aimed at fiscal consolidation and economic growth in October, finance minister P Chidambaram said today.

He also said the finance ministry expects the Reserve Bank of India (RBI) to take more "supportive measures" in its next policy review.

RBI left interest rates unchanged at its policy review on Monday, but cut the cash reserve ratio for banks by 25 basis points, saying its primary focus was fighting inflation (See: RBI cuts CRR by 0.25%; lending rates unchanged).

"I am very confident that between now and 30 October, since the government is expected to take a number of additional policy measures and also lay out the path of fiscal correction," Chidambaram said on the sidelines of Planning Commission meeting today.

For achieving optimum growth, Chidambaram suggested creation of a mechanism at the cabinet level to take final decisions on major investment proposals, especially in the infrastructure sector and, in particular, in the sectors and other growth sectors, so as to save time wasted in the long procedures at individual ministries.

He suggested the setting up of a National Investment Board chaired by the prime minister to take the final decisions on project and amendments to the in the Allocation of Business Rules to create such a mechanism.  He also suggested a Rs1,000 crore threshold for projects to be cleared by the National Investment Board.

''Once the final decision is taken by the National Investment Board, no other ministry or department or authority should be able to interfere with that decision or delay its implementation,'' he said.