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UPA is responsible for economic paralysis in country, alleges BJP

June 30, 2012 - New Delhi

The Bharatiya Janata Party (BJP) has blamed the Congress-led UPA Government at the Centre for failure to prevent economic slowdown in the country.

Senior BJP leader Murli Manohar Joshi put the blame on the internal fights within the ruling UPA coalition for the present economic paralysis in the country.

"The Reserve Bank of India (RBI) is not happy with the policies of the Central Government. Today, the RBI has issued a statement that the country is facing economic slowdown because of the economic paralysis of the government," he said.

Joshi said that local as well as foreign investors have lost faith in the government.

"Any sector, be it industries, business, manufacturing, service, agriculture or education, everywhere there is a sense of insecurity with the policies of the Central Government. Industries have lost confidence in the government. Even bureaucracy has lost confidence in the government," he said.

Joshi further raised objections against allowing Foreign Direct Investment (FDI) in retail sector, saying that it would have a negative effect on India's small-scale traders and farmers.

"These multi-nationals have come with proposals for FDI in retail. I have reports to show that they have been bribing people, bureaucrats in order to further their trade. It is highly dangerous both for the retail trader and as well as the farmers. Nor will they give anything cheaper. They will create problem of pollution, parking and changes in food habit," he said.

Chief Economic Advisor in Finance Ministry, Kaushik Basu, has, however, expressed the hope that the Indian economy is expected to rebound from October.

Asserting that the government was working to remove trust problems with the industry, Basu said: "We are hopeful that economy is going to bounce back within 4-5 months. I mean October. Before that I can't realistically say that there will be an improvement, but October onwards yes."

"We want to work hand in hand with the industry. There is element of trust problem between industry and government that has happened. Over the last several months we were trying to correct it and we will try to correct this as much as possible in the coming months," he added.

Basu further said there has been no dilution in any of the recent policy decisions.

"Actually, I don't think that any policy step has been diluted, any policy step of recent months. The message that we were giving for actually last couple of months, including during the time when Pranab Mukherjee was the Finance Minister, is the same message that we do want the industrial sector to do well and we want to be as cooperative as possible," said Basu.

"Now, you know what I was referring to about the regulatory system is something, which we inherited some 60 years ago. So, that was not a comment about what can be done over the next couple of months, but that is the direction in which we must go. We have been trying to do that over the last couple of years and what you have heard from the Prime Minister is simply a reiteration of what was there already on the agenda," he added.

Basu, who was speaking to the media at the 'Statistics Day 2012' meet organised by the government here on Friday, underlined the need for working hard to boost the manufacturing sector.

Basu's comments come amid attempts to bring the Indian economy back on track following Prime Minister Dr. Manmohan Singh taking additional charge of the Finance Ministry after Pranab Mukherjee resigned from the Union Cabinet earlier this week to contest the presidential election.


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