In another move to boost investor sentiment, Indian Prime Minister Manmohan Singh on Wednesday promised to speed the allotment of infrastructure projects and source more funds from private partners. But talk is cheap.
According to India's Economic Times newspaper, the PM promised to finalize contracts for 9,500 km of highways, port projects worth $6 billion, pubic private partnership (PPP) projects for at least 20 airports, two new major ports on the east coast, and a $3.5 billion elevated rail corridor for Mumbai.
Singh said that by the end of July, partnerships would be finalized for 10-12 existing airports and a similar number of greenfield airports, which would be awarded during the current fiscal year, the paper said.
Though the measures reportedly fell short of expectations, and setting higher targets is hardly a roadmap out of the current government paralysis, it just might be possible that the PM also brought the hammer down on his cabinet ministers, who have been reluctant to take decisions due to ongoing corruption investigations, as I reported Wednesday.
The benchmark Sensex responded sharply, rising 1.18 percent to hit a high for the depressing month. But it was aided by some alleviation of concerns about the ongoing crisis in the rest of the world, as well as auto makers' new optimism that the PM may not move to increase prices on diesel fuel to match last month's petrol price hike, according to Reuters.
Meanwhile, in terms of actions, the cabinet mothballed plans to reform India's pension system, according to the Indian Express, though that was supposed to be low hanging fruit among the many financial reforms demanded by industry and investors. Turns out the hope that party workers would be able to convince Mamata Banerjee -- who also scuttled Singh's plans to allow multi-brand retailers like Walmart into the market -- was, well, overly optimistic.