Congress plays down investor fears

Singh: Reforms must work for the great majority

Investors have been displaying nerves over the future of India's economic reforms since the Congress party swept to shock victory last week in general elections.

But senior Congress party leader Manmohan Singh has told the BBC the financial community has nothing to fear.

"Our policies will be pro-growth, pro-savings, pro-investment," Mr Singh said in an interview with the Asia Today programme.

He said Congress was committed to pursuing policies that would ensure "that our financial markets perform their allotted tasks with efficiency, with utmost transparency".

And he stressed foreign direct investment was welcome and that reforms would continue - although he made clear that policies would have to work "for the great majority of the people".

'Foreign investment'

Asked about concessions being demanded by left-wing parties on which Congress will rely in parliament, Mr Singh said "compromises have to be made".

We believe that profit-making enterprises... should be given all possible opportunities to grow Congress leader Manmohan Singh

"The mandate of the people is to pursue policies which are pro-growth but which at the same time reflect the concerns of accelerated investment in agriculture, the need for accelerated investment in education and health," he said.

"I believe whatever seeming contradictions that may exist in these kinds of areas with alliance partners... will be resolved.

"They will be resolved satisfactorily in a manner which will see orderly progress on all fronts in our country in years to come."

He said he hoped Congress and its allies would agree a draft of a common minimum programme "in the next two or three days".

Mr Singh rejected suggestions that Congress would be swayed by potential left-wing coalition partners who oppose the previous BJP-led government's policies on privatisation, labour reforms and economic growth.

A Congress-led government would not, he insisted, have a different approach to the role of private foreign investment in India's economy.

"We welcome foreign direct investment," he said, adding that portfolio investment was also welcome.

'Mid-course corrections'

"We are not going to reverse, for example, the good work that has been done in the past 10 or 12 years to create a favourable climate for enterprise - but life is not static," he said.

But he added that "mid-course corrections" were needed.

"Reforms yes - but reforms must be seen to be working for the great majority of the people of this country.

"In a country as poor as India all sensible economic policies must focus on getting rid of chronic poverty, ignorance and disease which still afflict millions and millions of our people - but that doesn't mean that we are against encouraging the spirit of creation, adventure and enterprise.

"We do not believe in privatisation as an ideology.

"We believe that profit-making enterprises which can survive and which can compete on an equal footing with the private sector... should be given all possible opportunities to grow."