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February 28, 2000
Weak capital formation rattles industry bodies
Industry chambers today said the Economic Survey for 1999-2000 reinforced the industrial recovery, but expressed concern over decline in agriculture production and capital formation.
''The significant growth in the core and infrastructure sector which has grown by 8.2 per cent in 1999-2000 from a meagre 2.8 per cent in 1998-99 is indicative of a major structural turnaround,'' President of the Federation of Indian Chamber of Commerce and Industry, G P Goenka said.
However, he listed drastic reduction in the agricultural production by negative 2.2 per cent from 7.4 per cent as an area of growing concern. He also expressed concern over decline in public savings, deceleration in disbursements and decline in corporate formation.
President of the Confederation of Indian Industry, Rahul Bajaj, was generally content with the economic recovery. But he wanted the government to have strong political will to take tough decisions and overhaul the subsidies system in the budget tomorrow.
He also wanted enactment of the Fiscal Responsibility Act and adoption of zero-based budgeting.
''Substantial improvement in infrastructure this year is a healthy sign and will help in achieving sustained economic growth,'' President of the Associated Chambers of Commerce and Industry of India, Shekhar Bajaj, commented.
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