WASHINGTON, D.C.— Indian Finance Minister Nirmala Sitharaman, during her visit to Washington, D.C. for the annual World Bank/International Monetary Fund meetings, said on of. 16 that the Indian government’s plans to attract investment in Jammu and Kashmir would be unveiled soon.
During an interactive session with potential investors at a forum on the sidelines of the World Bank/IMF, organized by the Federation of Indian Chambers of Commerce and Industry (FICCI) and the U.S.-India Strategic and Partnership Forum (USISPF), Sitharaman said that the areas of investment that New Delhi was considering was first and foremost in tourism and its ancillaries, including handicrafts, carpets, silk, and woodwork.
She also said that agricultural products and spices from apples to saffron would also be areas that are likely investment areas for this Muslim majority state, which was stripped off its special status contained in Article 370 of the Constitution by New Delhi on Aug. 5, and in its aftermath led to tensions with Pakistan and U.S. Congressional concern over the ‘humanitarian crisis.’
At the forum held at the IMF headquarters, Sitharaman said, “We have started working in terms of making sure that the full potential of Jammu and Kashmir from various different aspects” is implemented, and added, “I think sooner the details of it will be available,” vis-à-vis the new policies currently being drafted the government.
At the same interactive forum, Sitharaman told the diverse group of international investors that India still remains one of the best places in the world to invest and that the government was consistently working on reforms to make more incentives available to make India even more attractive for foreign direct investment.
She said that besides India being “one of the fastest growing economies even today,” it also “has the best skilled manpower and a government that is continuously doing what is required in the name of reforms, above all democracy and rule of law.”
"So, you will not have anything better... democracy loving, capitalist respecting environment... in India," Sitharaman added.
The next day, in-between attending the Bank and IMF sessions, Sitharaman, asserted that notwithstanding the IMF’s projections in its World Economic Outlook that India’s economic growth rate would dissipate, India still remained up there among the fastest growing economies of the world.
But Sitharaman refused to be drawn into the perennial growth rate comparisons with China, saying, “I am certainly not risking a comparison" albeit the IMF projecting that both India and China will experience similar growth rates of 6.1 percent this year.
In its World Economic Outlook released on Oct. 15, the IMF said India’s growth rate of 6.8 per cent in 2018 would drop to 6.1 per cent in 2019, but predicted that it would pick up and register 7 per cent in 2020, if the government implemented all of the policies on tap.
When asked if the slowdown of Indian economy is cyclical or structural, Sitharaman said it may be both, may not be both, may be partly one and/or may be partly the other.
Meanwhile, asked if an India-U.S. trade deal is in the offing, which many people had hoped would take place when Prime Minister Narendra Modi visited the U.S., the finance minister was circumspect.
She would only say she was hopeful since there had been a narrowing of differences between both sides during recent meetings and the commerce ministry was hard at work to make this happen.
The feisty minister, who earlier held the Defense portfolio in the first term of the Modi administration, creating history as the first woman to do so, also strongly defended her criticism Dr. Manmohan Singh administration and the erstwhile Reserve Bank of India Governor Raghuram Rajan, who had taken some pot shots at the Modi government for always whining about the previous government.
On Oct. 17, Dr. Singh had pilloried the Modi government for constantly blaming the UPA government for all of the country’s economic woes and arguing that surely five-and-a-half years were ample time for the NDA to come up with solutions.
Addressing a press conference ahead of the Maharashtra elections, Dr. Singh was replying to a question on Sitharaman’s contention while in the U.S. and addressing a conference at Columbia University in New York, where she had said that the banking sector during the tenures of Dr. Singh and Rajan had passed through its worst phase.
In her remarks Sitharaman said, "I have no reason to doubt that Rajan feels for every word of what he is saying, and I'm here today, giving him his due respect, but also placing the fact before you that Indian public sector banks did not have a worst phase than when the combination of Singh and Rajan, as prime minister and the RBI Governor, had. At that time, none of us knew about it.”
While acknowledging that there were some "weaknesses" during the tenure of his administration, Dr. Singh said that the NDA government should have learnt from the UPA’s “mistakes” and provided “credible solutions,” instead of finding fault with the UPA for every economic crisis.
Sitharaman told reporters, "I respect Dr Manmohan Singh for telling me not to do the blame game. But recalling when and what went wrong during a certain period is absolutely necessary to put it in context, now that I'm being charged that there's no narrative at all about the economy.”
She also made clear that her remarks at the Columbia University meeting was in response to a question, where the questioner had quoted from parts of a speech Rajan had made about a centralized leadership and the absence of a coherent narrative of the economy.
Sitharaman argued that she did not believe she had crossed any line by giving the response she did, whether it was within India or outside of the country.
Continuing to hit back at Dr. Singh and Rajan, she said, "If there is a charge against us that we have not given a cohesive narrative about the economy, I'm sorry, probably it has not even reached the narrative that we're given about the economy or the target with which we are working, or the response with which we are answering those stress in different parts of the country.”
“Those industries which are under stress, those messages have probably not even reached people who have commented on us,” she added.
Thus, Sitharaman reiterated, "I had to recall that. So, it's not so much with the sense of wanting to put the blame on somebody.”
"I don't need to put the blame. It is more than apparent as to when the wrongdoings happened in banks and which is the government which is spending time to clear the clog from public sector banks and which is the government which is pursuing all those who have taken money during the UPA government and who've gone out to the country out of fear that action is being taken now under this government," she said.
Sitharaman said, "We never committed mistakes and corruption. We've not given any loans to cronies. We've never supported any wrongdoing and looked at the way when as prime minister, I would want to again recall the number of corruption cases which had happened during the UPA. Has there been anyone here, during the time of the NDA?”
“These are not lessons learned. These are the present government's convictions. Lessons have to be learned by people who should have learnt it even earlier,” she added.