With decline in FDI inflows, the Government has said that it needs to work on reform-friendly policies to attract increased overseas investment in the country.
“We have to strive to make the domestic environment more conducive to investment, encouraging public as well as private investment and domestic as well as foreign investment, particularly foreign direct investment,” the President, Ms Pratibha Patil, said in her address to Parliament today.
During April-December this fiscal, FDI inflows declined by 23 per cent to $16.03 billion from $20.87 billion in the year-ago period.
While the Government has taken preliminary steps like initiating discussions on allowing FDI into multi-brand retail and increasing the cap on overseas equity in defence production, the decisions remain pending for long.
Global retail chains like Wal-Mart, Tesco and Metro, which have been allowed in the wholesale cash and carry business, are lobbying hard with the Government to open FDI in multi-brand retail.
“We have to maintain the momentum for reforms on a wide front,” Ms Patil said.
She said although the Indian economy is on a high growth trajectory, still there is no room for complacency.
“The policies followed to handle the global financial meltdown stand vindicated. However, there is no room for complacency,” Ms Patil added.
Reforms in insurance sector are also on the agenda and the Bill relating to this is pending in Parliament.