Kumar said that government announcements over the past two months and the RBI’s fifth consecutive rate cut indicated that all efforts were focused on accelerating growth.
“We do want to have this growth rate which will probably end about 6.5% this year which is lower than what we expect, to go up to 8% sooner rather than later,” said Kumar, at the India Economic Summit organised by the World Economic Forum and the Confederation of Indian Industry in the capital on Friday.
The RBI on Friday cut rates by 25 basis points, bringing the repo rate to 5.15%, the lowest since March 2010. The RBI also cut its GDP growth forecast to 6.1% from 6.9%. The RBI has cut repo rates by 135 basis points, cutting rates in every policy meetings this year. One basis point is one hunderedth of one percent.
The government has in the last two months come out with a slew of measures, including cutting corporate tax rates from 30% to 22% and from 25% to 15% for new manufacturing companies, aimed at boosting flagging growth. GDP growth slowed to a six-year low of 5% in the April-June quarter.
Kumar said there would be a lot more announcements on ease of doing business and that the government was aware of and working on issues faced by industry, particularly around logistics and high energy costs.
“We are now considering acquiring land or using land already there with public sector to attract investment and FDI so that their project risk is minimised,” said Kumar.
On labour reform, Kumar said that two more labour codes would come out in the next parliament session.
“This will greatly simplify the labour scene in India and will codify all the 200-odd laws that were there. There is going to be a much sharper focus on improving the investment and business climate in India,” said Kumar.