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Hoping for a pick up in economic headwind after a change of guard in the finance ministry, captains of Indian industry have said strong measures must be taken to counter the country's fiscal deficit. After meeting the Chairman of the Prime Minister's Economic Advisory Council, C Rangarajan here, industry leaders told media that that strong measures must be taken to counter the fiscal deficit "Fiscal deficit needs to be tackled strongly, through both disinvestment and containment of subsidies. We have also suggested early announcement of FDI in multi-brand retail, aviation, defence, insurance and other such sectors," said Confederation of Indian Industry (CII) president Adi Godrej. "We have suggested that the depreciation of the rupee should be contained adequately, that the repo rate and CRR should be cut, and that we should have a very strong package announced very soon, so that the economic growth is revived again at an early date," he added. ASSOCHAM chief Rajkumar Dhoot said it was important to attract more foreign investment into the country. "The time has come to attract foreign investment, because of the depreciation of the rupee. Our import is very high, so the problem of pricing is very high. Inflation is very high. We have requested (the government) to reconsider dual pricing of diesel, which is a very important matter, and simultaneously to reduce the interest rate, which has a major effect on the industry," Dhoot said. Rangarajan, however, said there was limited scope for fiscal action, but within such scope, as was available, a focus on increasing capacity creation would spur growth. "I think the fiscal space available at the moment is limited. We cannot repeat the kind of things that we did in 2008. But we can certainly look at the composition of government expenditure, and I would really think that we must shift the composition of the government expenditure in the direction of greater capacity creation. I think that will provide us a great stimulus to economic growth," Rangarajan said. Asia's third largest economy is growing at its slowest pace in nine years, the rupee is the worst performing currency in the region this year, and the country faces the threat of having its sovereign credit rating downgraded. Many investors and economists blame weak leadership and muddled policies that have failed to curb government spending and alienated many foreign investors. However, Prime Minister Manmohan Singh's latest efforts to turnaround investor sentiment have raised hopes of an economic revival.

Corporate India seeks strong measures to counter fiscal deficit