Cash rich PSUs to invest in projects to spur growth

The government is working on a mechanism under which ninemajor public sector undertakings (PSUs) having large cash reserves would startinvesting in infrastructure projects in a time-bound manner to boost growth.

Disclosing this, Arvind Mayaram, secretary of department ofeconomic affairs (DEA), Tuesday said Finance Minister P. Chidambaram will meetchairmen and managing directors of the PSUs Wednesday and fix the deadlines forthe companies' investment.

"The identified PSUs are sitting on cash reserves ofRs.1.8 lakh crore. The identified projects will soon be posed to the unionCabinet for time-bound implementation of the projects," Mayaram said.

He was addressing the national executive committee meetingof the Federation of Indian Chambers of Commerce and Industry (FICCI) here.

Among other plans, Mayaram said the government would make aseries of interventions to trigger growth in the economy like bringing onstream road and petroleum sector projects of Rs.1,000 crore or more.

In the next three months, a PPP (public-private partnership)framework will be put in place for creating warehousing facilities for foodgrains, entailing an investment of Rs.20,000 crore.

The DEA secretary said the government was aware of the lackof credit and that it was committed to ensuring early financial closure oflarge private sector companies.

"A slew of decisions have already been announced toease external commercial borrowings and borrowings for Indian companies abroadwould be made easier for retiring domestic loans."

Mayaram also said that steps were being taken to control thefiscal deficit.

"This would involve a little hardship across the board,from low-income to high-income earners. The pain of fiscal correction will befelt by everybody."

The key finance ministry official also urged the industrynot to discount the good news on the economic front.

"The country had 80 million tonnes of food grain bufferwhich will be utilized to temper food prices; personal, home and vehicle loandisbursement have looked up and consumption remains strong.

"Even with a rate of growth of 6 percent, India remainsa country with high growth and we must recognize this," he said.