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PM wants revival of economy with animal spirit

New Delhi: Signalling his keenness to boost the economy a day after taking charge of the Finance Ministry, Indian Prime Minister Manmohan Singh on Wednesday directed urgent steps for revival of investor spirit and reversal of the climate of pessimism with regeneration of "animal spirit".

Taking stock of the country`s economy in a series of high level meetings here, he identified tax issues, sluggishness in insurance sector and aspects related to mutual funds as problem areas and pressed for quick corrective steps.

The meetings were attended by Planning Commission Deputy Chairman Montek Singh Ahluwalia, PMEAC Chairman C Rangarajan and top Finance Ministry officials. He will meet RBI Governor D Subbarao and Planning Commission members on Thursday as part of his review of affairs concerning the economy.

Contending that he had been "away from the details and nitty gritty of finance for a long time", the Prime Minister told officials of the Finance Ministry that there have been many factors that have contributed to the general negative mood being witnessed in the country.

"We need to work to get the economy going again and restart the India growth story," he said, against the backdrop of slowdown in the GDP growth, which slipped to a nine-year low of 6.5 per cent in the last fiscal.

"Reverse the climate of pessimism… Revive the animal spirit in the country`s economy," Singh said, while observing that India was passing through challenging times economically.

He noted that the growth rate has taken a dip, industrial performance is not satisfactory and "things are not rosy" on the investment front while inflation remains a problem. "In the short run, we need to revive investor sentiment, both domestic and international," he said.

Talking about the problems, Singh said he referred to the "tax front", mutual fund segment and slowdown in insurance sector "which is not normal in a country with large unmet insurance needs". "This needs to be looked into," he said but did not elaborate.

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