India is set to announce fresh measures to boost job creation and the economy, and will push ahead with reforms after the Congress-led coalition's election victory, Junior Industry Minister Ashwani Kumar said on Sunday. The global economic slump has hit Asia's third-largest economy harder than expected, with growth expected to slow to a seven-year low of about 6 percent in 2009/10 (April/March).
"Of course, we will give packages for the revival of industry," Kumar told Reuters in a telephone interview after the ruling Congress-led coalition unexpectedly strong election win. "Major packages could be given to the manufacturing sector and those industries which provide jobs to large number of people," he said, but did not elaborate. Prime Minister Manmohan's Singh's ruling left-of-centre coalition was in talks with potential parliamentary allies ahead of a second term in office after winning a clear victory in national elections.
During the campaign, Singh said his government would try to revive the economy in 100 days if returned to power. Growth slowed to less than 7 percent in the 2008/09, Singh has said, from rates of 9 percent or more in the previous three fiscal years.
To lift growth, the central bank has slashed its key lending rate by 425 basis points since October, while the government cut duties and boosted spending. Policy makers say the economy requires fresh stimulus this year, but an election code of conduct prevented the government from rolling out new measures during the election campaign.
"The focus will be on balanced agricultural and industrial growth," Kumar said. "Reforms will be undertaken to kick-start the economy and the priority will be to undertake pending economic reforms." In its first five-year term, the Congress-led coalition met with stiff opposition from its communist allies over reforming the insurance and pension sectors, and also on stake sales in state-run firms.
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