New Delhi: Finance Minister Arun Jaitley on Tuesday vowed to restore investor confidence and check inflation as he tries to steer the economy through challenging times and bring it back on the path of high growth.
Soon after taking over as Minister for Finance and Corporate Affairs, Jaitley said that he had inherited a "lot of unpaid bills" and a strained economy.
"I am conscious of the fact that I am taking over at a very challenging time, particularly when there is a need to rebuild the confidence of the Indian economy," he said as he held a series of meetings with officials to decide on the Narendra Modi government's policy directions.
"The challenges are very obvious. We have to restore the pace of growth, contain inflation and obviously concentrate on fiscal consolidation," Jaitley added.
Economic growth slowed to 4.9 percent in 2013-14 and retail inflation in April stood at 8.59 percent. The current account deficit narrowed to 1.7 percent of GDP while the fiscal deficit is estimated at 4.6 percent of GDP in 2013-14.
The new finance minister, who pitched for a balance between growth and inflation, had a 50-minute meeting with Reserve Bank of India Governor Raghuram Rajan and discussed the macroeconomic situation and external sector.
"It is absolutely a task that the government and the RBI are engaged (in fighting inflation). RBI has always maintained the balance between growth and inflation," Rajan said after the meeting.
As the new government beefs up efforts to put the economy back on track, all five departments in the finance ministry have prepared presentations to brief Jaitley.
"The political change itself sends a strong signal to the global community as also domestic investors. Over the next two months, by expediting the decision-making processes, we will be able to build on that," he said.
Jaitley said the entire policy of the new government would be spelled out in the next few days.
At its first cabinet meeting later in the day, the Modi government set up a special investigative team headed by former Supreme Court judge M B Shah to unearth black money.
Over the next couple of days, Jaitley will hold meetings with various stakeholders for preparation of the regular budget for 2014-15.
He took stock of the economic situation with the Department of Economic Affairs making a presentation.
"This is preparation to the budget as well," Minister of State for Finance Nirmala Sitharaman said.
After the meeting, Finance Secretary Arvind Mayaram said fiscal consolidation, the fiscal deficit, gold import curbs and diesel price decontrol were discussed.
Asked how bad the economic situation was, Jaitley summed it up as: a "lot of unpaid bills."
Fuel and fertiliser subsidies worth Rs 80,000 crore have been rolled over from the fourth quarter of 2013-14 to the current financial year.
Jaitley, who is managing the two heavyweight portfolios of Finance and Defence, will have to shuttle between North Block and South Block. He also took charge of the Ministry of Corporate Affairs, which has been clubbed with the Ministry of Finance after a decade of independent existence.
"There will be clubbing. Currently the (Corporate Affairs) ministry is under me. A notification has to come," Jaitley said.
First Published: Tuesday, May 27, 2014, 11:19