We are in no hurry to withdraw Covid stimulus, says FM
WASHINGTON: The government is not planning to withdraw the pandemic stimulus package any time soon, Unon finance minister Nirmala Sitharaman told Bloomberg news service in an interview.
“They will continue” as will the “emphasis on building health infrastructure” and government spending on capital expenditure and infrastructure, she added.
Bloomberg interviewed the minister in New York on Sunday.
Sitharaman just wrapped up a multi-city tour of the US that included her first bilateral meeting with her US counterpart Janet Yellen, meetings at the World Bank group and business leaders.
Though the government will keep in the place the stimulus package, it is watching with concern rising crude oil prices and, she said in the interview that the uncertainty could jeopardize some of her plans to put the economy back on track.
“The challenge I will face, and the teams are also watching in the ministry, is the way the fuel prices are leading to a big crest,” Sitharaman said. “This uncertainty is a big element for me, which is still an imponderable and I don’t know how much will have to be diverted from other most important considerations, and that’s the challenge I see.
She further told the news wire service that the government has already committed a certain amount of public spending to build infrastructure to provide support to the economy.
Meanwhile, while speaking about the share sale of the country’s biggest insurer, she said that the government is pushing to get the initial public offering of state-backed Life Insurance Corp. of India across the line by next March and any delay won’t be due to a lack of political will.
“We are pushing to have it done,” Sitharaman said when asked if it will manage to complete within the current fiscal. “The problem is not that we don’t want it or we are pussyfooting on it now, it is more a question of doing the due process.” The internal valuation that’s needed “almost annually” for a company of LIC’s size, “hasn’t been done,” she said. Given that the insurer hasn’t ever been valued, the process will take time, she said.
“So the delay or the time that is being consumed is not due to the lack of political will to go ahead with the stated policy,” she said.
Sitharaman announced plans to sell shares in the insurer in February 2020, but pandemic slowed the process. The minister revived the offering in February this year, but the valuation report is yet to be finalized