Political Noise over CAG Reports to Push Back Major Reforms: Assocham

New Delhi: Political tussle over the CAG reports on coal blocks and Delhi International Airport will push back major economic reforms like FDI in retail and Goods and Services Tax, a survey by industry body Assocham said. "As the national economic agenda is being used as a football in the political arena, reforms measures like FDI in retail, GST, DTC, Company Law Bill and banking and insurance liberalisation are certainly going to be pushed by a few years," the survey said. Economists and industry leaders participated in the survey. "This is sad because the economy needs a non-partisan approach because the GDP growth has touched a nine-year low of 6.5 percent," Assocham President Rajkumar Dhoot said in a statement. Majority of the industry leaders who participated in the poll, said they saw little hope of the big ticket reforms being pushed under the present political environment, where the ruling UPA and the principal opposition parties have locked horns followed tabling of three reports of the Comptroller and Auditor General (CAG). However, it said fews steps taken by the government and capital market regulatory Sebi have boost the investors confidence. The government has taken steps like increasing penetration of mutual fund products and energising distribution network. Besides, the Finance Ministry has expanded the scope of external commercial borrowings by allowing the non-banking finance companies to tap this sources. It has also set up an expert panel to remove doubts on the retrospective tax laws. "But unfortunately, all these measures are being drowned in the political noise over CAG. The stubborn stand taken by some parties, including in the UPA, on issues like FDI in retail, aviation and reforms of the pensions sectors, is pushing the economic agenda back," it said. The survey also said that the government would not be able to control expenditure in 2013-14, as that would be a penultimate year for the general elections due in 2014. "Besides, there would be pressure on the UPA to come out with populist schemes which may upset the fiscal calculations," it added.