Citing long-term opportunities in sectors like infrastructure and defence, Prime Minister Manmohan Singh on Saturday invited US companies to invest in India while asserting that concerns about the country's growth prospects and economic policy environment are "mistaken".
Seeking to assure the foreign investors, he told US industry leaders that virtually all political parties in India have supported the process of reforms since 1991 which gives confidence about the future direction of the country's economic policies.
Singh made the remarks while addressing US CEOs forum soon after his arrival in New York from Washington. He acknowledged that India's growth had slowed down and touched 5 per cent from the average of eight per cent witnessed over the last decade but expressed confidence that there will be a turnaround in the second half of the current fiscal because of steps the government has taken besides the good monsoon rainfall.
"I am aware that the business community in the US has some concerns about India's growth prospects, macroeconomic stability and the economic policy environment. Doubts have been expressed about our sincerity in this regard. This is a mistaken perception," Singh said in his opening statement to business leaders.
He said the government is committed to "fostering an economic environment that is open, predictable and transparent" as well as investment friendly. "The results of our efforts will be visible in the second half of the year. We expect stronger growth in 2013-14 than in 2012-13. The second half of the year should see a distinct turnaround, partly because of the good monsoon and partly because of the steps we have taken," he said.
Singh acknowledged that in order to restore the high growth momentum and maintain macroeconomic stability, there is need for "more and not less reforms." "We are committed to getting India back to a sustainable growth path of 8-9 per cent. Indeed the Indian people will not tolerate anything less," Singh said.
Singh touted the "longer-term opportunities" in sectors like infrastructure and defence, saying the government intends to invest more than a trillion dollars in the next five years in the infrastructure sector.
Noting that the defence sector is "another attractive area", Singh said priority will be placed on domestic procurement. The Prime Minister told the business community that the Indian government has implemented a series of reforms to restore growth, including increasing investment limits in FDI in retail and telecom.
The government has also taken several decisions to "remove impediments" in the way of important projects, he said.
Singh also sought to assure the business community that the fiscal deficit will be contained to 4.8 per cent this year and expressed confidence that the current account deficit would be reduced to 2.5 per cent of the GDP.
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