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Press Briefing 08-05-2014
Shri P. Chidambaram

Shri Chidambaram said I have distributed two sets of papers containing data - one containing two tables and other giving the breakup.

In my opening statement I wanted to say that we are cautious that investment must revive in this country. While the economy in my view has stabilized the investment cycle has to start again - both domestic investment and foreign investment must be encouraged. Investment cycle must start again and that would lead us to high growth.

I think given some data about what kind of investments have been received and what kind of investment have been contemplated. In the first statement you will find that in 2012-13 we attracted FDI of 26.95 Billion US Dollars. In 2013-14 - up to Feb. - we have attracted 26.9 Billion US Dollars and by March it would be more than what we attracted in the previous year and I think FDI of about 27 Billion US Dollars is a good performance. We should try to do better in 2014-15.

As far as Public Sector Enterprises are concerned, I have given numbers. Numbers are available in 2012-13 only for 16 PSUs monitored by the National manufacturing Competition Council but for the subsequent years it is available for 23 PSUs which is why we have two lines there. If you take the 16 PSUs, in 2012-13 they invested Rs. 1,11,824 crore; in 2013-14 it went up to 1,16,860 crore and in 2014-15 they plan to invest Rs. 1,22,838 crore. If you look at 23 PSU, you will find the number in 2014-15 goes up to Rs. 1,33,030 crore. We set great store in PSU investment profits laid by PSUs, of course taxes are paid, dividends are declared but a very substantial portion is reinvested as capital expenditure for expansion, machinery and new technology.

Public Sector banks capitalization also is a very important agenda. In 2012-13 we invested Rs. 12,578 crore; in 2013-14 we invest Rs. 14,000 crore; in 2014-15 demand is for such a large amount of money. The government has to provide for it. The budget has provided only the modest amount so far but we hope to provide more money for the requirement as Rs 45,515 crore - additional capital for public sector banks. Some of them are being allowed to raise capital in the market. The government, of course, will put in money but they will also raise the capital in the market.

In the second sheet, I have given the breakup of the public sector investment. You will also see from the said sheet that how the major public sector companies are going to invest Rs. 1,33,030 crore. There is another issue of inflation. Open market sales are one way of cooling the inflation. The government has, in fact, in the last two years sold large quantities in the open market. In 2012-13 we sold 69 lakh tons of wheat and in 2013-14 we sold 61 lakh tons of wheat. We are willing to sell more but there must be takers. We have large stocks of wheat and we will continue to use this method to cool down the wheat prices. In fact price of wheat and rice have been remarkably stable over the last two years. Inflation is largely driven by food articles and within the food articles, as I said once before, inflation is driven by five items i.e. vegetables, fruit, milk, meat and eggs. We are cautious that selling food grain is one way of cooling inflation.

Tom Vadakkan
Media Secretary
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