Finance minister P Chidambaram announced on Sunday the setting up of three-member Investment Commission, headed by Tata Group chairman Ratan Tata. The other two members are HDFC chairman Deepak Parikh, chairman of I-OneSource and former chairman of HLL Ashok Ganguly. Speaking at the opening session of the three-day India Economic Summit 2004 here, the finance minister said that the Commission would aim at attracting investments worth $150 billion in the next 10 years, with the thrust on infrastructure, financial services and agriculture sectors. 

The Commission would engage potential investors on behalf of the government, identify their problems and advise the government on the measures needed to spur flow of investment into the economy. It would be equipped with the ‘full authority’ of the government, will be the government’s ‘face and voice,’ and have a mandate to be ‘helpful’ to investors, the minister said. He added that the government welcomed investment in ‘every sphere’ of the economy. 

Commenting on financial sector reforms, he said a broad roadmap of  banking sector reforms — including consolidation in the sector, would be drawn up in December itself. As for insurance sector reforms, discussions were on, and the government expects to introduce the relevant bill ‘early next year’. A pension regulator will be in place by the end of this year. Making a plea to the global business community to turn its eyes to the Indian economy, which he said is now capable of a sustained decadal growth of at least 7%, he underscored what he called the emergence of a ‘broad consensus’ in the country on a wide range of  issues. 

These include the need to exercise fiscal discipline (with the objective of wiping out the revenue deficit by 08-09), perception of trade as a growth driver as well as prudent management and monitoring of the country’s external debt. The Investment Commission, promised by Mr Chidambaram in his budget speech earlier this year, will give top priority to attracting investment in infrastructure sectors like telecom, power, petroleum, airports and sea ports and roads. 

“Agriculture will need the greatest quantity of investment,” the minister said, adding that the focus would be on introducing good farming and post-harvesting practices, adoption of new technologies and inputs and finding new export markets for farm goods. “Agriculture exports would double every year in the next ten years.” In response to a question, Mr Chidambaram assured a foreign delegate attending the summit that the notification issued in March this year hiking foreign direct investment (FDI) limit in private banks to 74% would not be amended.

“But the PSU banks will give you (foreign investors in banking domestic sector) a run for your money,” the minister said. IES 04 is organised by the World Economic Forum in partnership with the Confederation of Indian Industry. India attracted just $4.68 bn of  FDI in 2003-04, close to $1.5 bn less than the peak of $6.13 bn recorded in ‘01-02.