RBI Governor optimistic about passage of GST

Washington (PTI): Optimistic about the passage of long pending GST bill in the Parliament, Reserve Bank of India Governor Raghuram Rajan has told American investors that continued focus on fiscal consolidation and inflation will mean they will reach their targeted goal.

International Monetary Fund's Economic Counsellor and Research Department Director Raghuram Rajan answers a question during a press conference on the World Economic Outlook (WEO) at the Suntec Covention Center in Singapore September 14, 2006. The IMF and the World Bank normally meet once a year in the autumn for a two-day plenary session to discuss the work of their respective institutions. IMF Staff Photo/Stephen Jaffe

In an interaction with American financial institutional investors in New York last week at an event organised by US India Business Council, Rajan said another priority of the RBI is to clean up banks and their non-performing assets.

Rajan said RBI’s continued focus on fiscal consolidation and inflation will mean that they will reach their targeted goals, according to a USIBC media statement.

Another priority is to clean up banks and their non-performing assets, he said. Intention is to give banks more powers to allow for greater recovery of money and give relevant stakeholders an active role in the resolution process, he observed.

During the interaction, Rajan said he is optimistic about the passage of GST and the opportunities for compromise that will help realise the goals of the GST – a unified tax market, improvement in tax collection and broadening the tax base, USIBC said.

Led by USIBC chairman and president and CEO of MasterCard, Ajay Banga, the discussion focused on issues such as inflation and fiscal deficit management, recent rate cuts and monetary policy, deepening capital markets, modernising India’s capital markets to mobilise investment in Indian infrastructure and world-class companies.

Industry’s desire for reforms also included further development of a corporate debt market, improved infrastructure trusts and debt fund structures, long-term rupee-denominated government securities, and an updated external commercial borrowing regime, USIBC said.

USIBC applauded the Indian government for its recent reform introduced in private sector banking that permits the total foreign holding in private banks to have a composite cap of 74 per cent and eliminates existing sub-limits for FDI and FII capital (which were at 49 per cent).

Banks and investors will have greater flexibility to raise capital and to meet the stringent capital adequacy norms. This reform is a critical step in supporting credit growth in the financial markets and the Indian economy, USIBC said.

“As global commercial institutions and investors, we remain profoundly committed to India as we continue to provide a variety of long-term resources – including capital, technology, and know-how – which will help advance the Prime Minister’s goals of financial stability, economic growth, digital access, and financial inclusion,” Banga said.

USIBC president Mukesh Aghi said the Indian financial markets are an important driver for the country’s economic growth. “There needs to be a level playing field for global participants in India’s financial markets with clear, nationality-neutral regulations across all asset classes,” he said.

3 Comments

  1. RBI Governor optimistic about passage of GST – private sector banking that permits the total foreign holding in private banks to have a composite cap of 74 per cent and eliminates existing sub-limits for FDI and FII capital (which were at 49 per cent).

    SO THE PRIVATE SECTOR BANKS ARE FOR SALE TO MULTINATIONALS TO HAVE STRANGLE HOLD ON INDIAN ECONOMY! THANKS TO MODI.

    Washington (PTI): Optimistic about the passage of long pending GST bill in the Parliament, Reserve Bank of India Governor Raghuram Rajan has told American investors.

    LONG PENDING SINCE 2004. COULD NOT BE PASSED DUE TO OBSTRUCTION BY NDA. REASON FOR OBSTRUCTION WAS TO STOP CONGRESS DO GOOD TO INDIA. WHAT IS THE GREAT HURRY NOW, IF THE BJP COULD THWART IT FOR A DECADE AND YET WIN THE ELECTIONS?

  2. Dear readers,

    It seems win-win deal after cuting the deal with Congress behind closed door.So the RBI governor is early predicting the GST bill sailing through both houses of parliament to become effective in 2016 April after 10 years hurdle by NDA in opposition.

    How the ‘Sabka saath,sabka vikas will effective if ‘Foreign Direct Investment’ taking cream by multinationals using cheap labour under the new brand of ‘make in India’?

    Will BJP explain to the nation why does it has opposed the GST bill in opposition all these years?

    Jai Hind

  3. In 2000, the Vajpayee Government set up a committee headed by Asim Dasgupta, the (Finance Minister of the Government of West Bengal) to design a model for GST and oversee IT preparations.
    GST was initiated by the Vajpayee Government .
    NDA government never disrupted Parliament in GST issue.
    UPA had a chance to implement GST during the 10 years rule. But they were busy with looting the nation with series of scams

Leave a Reply