Indian economy will bounce back soon: Pranab Mukherjee

"There is no reason for an atmosphere of gloom to prevail. Indian economy's fundamentals remain strong.

Kolkata: Exuding confidence that the Indian economy will bounce back soon, President Pranab Mukherjee Saturday said there was no reason for gloom to prevail as steps were being taken to boost investments and contain fiscal deficit.

"There is no reason for an atmosphere of gloom to prevail. Indian economy's fundamentals remain strong.

"Stabilising the rupee is foremost in the minds of the policy makers. Strong measures have been initiated to strengthen the external sector," he said at the annual meeting of the Bengal Chamber of Commerce and Industry here.

There are areas of concern but there is no room for gloom or despondency, he said.

Observing that steps taken to contain fiscal deficit and boost industrial investments "should show positive results", Mukherjee said "I am confident that the Indian economy will soon return to the high growth trajectory."

He maintained that the process of economic reforms have to be continued "with vigour and firmness. Changes wherever required have to be brought in to unleash our growth potential."

The President said there are crucial legislations pending in parliament, which clearly demonstrates the determination of policy makers.

Mukherjee also referred to the good monsoon this year which, he said, would impact positively on agricultural growth and food prices.

Our experience in the recent past has shown that we have to live with adversities whether it comes from the external or the domestic sector, he said.

Stressing that steps need to be taken to improve the performance of the manufacturing sector, he said the sectoral share of manufacturing in the GDP has remained at around 16 per cent since the 1980s, compared with 25-34 per cent for some of the Asian economies.

Increasing competitiveness of the manufacturing sector would be crucial to achieve the target of taking its contribution to GDP to 25 per cent, he said.

"To make it easier for business to thrive, we must have a relook at our regulatory mechanisms and the need for multiple approvals," the President said.

However, he reminded the industry that "maintenance of good industrial relations is also important for productive industrial activity. The labour laws should bring about a win-win situation for both the employees and the employer."

Mukherjee also reminded the corporates of being "more appreciative of the need to have growth with equity and inclusiveness" and said the industry, "with growing ability and capacity, has an obligation to bear towards societal development."

He asked the private sector to come forward to complement government efforts in areas like health, education, rural upliftment, industrial training and skill development and said such activities, taken up as corporate social responsibility, should also be "carefully targeted and closely monitored for successful implementation."