Finance Minister Arun Jaitley on Saturday stressed on the need to improve the business climate in the country in the wake of the general slowdown in the economy and investments.
Addressing a meeting of the Financial Stability and Development Council (FSDC) here, Jaitley called for financial stability and coordinated efforts by the regulators to improve the business confidence.
“There is a need to improve business climate and reduce the cost of doing business as important means for revival of the investment cycle,” he said after the FSDC meeting. This was his first visit to the commercial capital of the country as finance minister.
“There were general discussions on the current financial and economic indicators, and also on any suggestions any regulator has with regard to the forthcoming policies of the government,” he told media persons after the meeting.
He also sought proposals on the vulnerabilities of capital flows. FSDC is chaired by the finance minister and the members are the financial sector regulators, including the RBI and the Sebi.
Jaitley’s Mumbai visit is in the midst of Budget preparations. He had addressed captains of industry on Friday and he is expected to meet state finance ministers on Monday.
“There are high political expectations from the new government and the opportunity is now available for resolving long-pending problems facing the economy. There is a need for coordinated approach by all the regulators to achieve financial stability,” Jaitley said.
He added that he is against “slackening the vigil in the area of fiscal consolidation”. Asked about the government’s view on the recently released report on governance of banks by P J Nayak committee, Jaitley said, “You will have to wait for our application of mind on these subjects.” The Nayak committee has recommended, among other things, bringing down government’s holding in public sector banks below 51 per cent.
RBI Governor Raghuram Rajan, Sebi chairman UK Sinha, Irda chairman TS Vijayan, Forward Markets Commission chairman Ramesh Abhishek and finance ministry officials attended the meeting.
Rajan spoke about the recent improvement in vital macroeconomic parameters, increase in forex reserves and stability in exchange rates.
“The finance minister took suggestions from regulators with the Union Budget in mind. He asked all regulators to submit their presentations in a report recommending action for the forthcoming Budget and for long-term polices,” said an official who attended the meeting.