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FICCI urges investment-boosting budget

Leading Indian trade body FICCI urged the government on Wednesday to use next week's budget to boost investment and leave to other agencies the cost of funding reconstruction from last month's earthquake.

"The main mantra for the budget should be to invest, invest and invest," said Chirayu R Amin, president of the Federation of Indian Chambers of Commerce and Industry (FICCI).

"The government should take all measures to boost capital formation in the country and help in producing a resurgent capital market," he told a news conference in Calcutta.

Amin said that the budget, due to be unveiled on February 28 by Finance Minister Yashwant Sinha, should not be used as the main engine for reconstruction in quake-devastated Gujarat.

"There are other options available," he said, pointing to funds offered by multilateral agencies such as the World Bank, private firms, financial institutions, volunteers and banks.

"Reconstruction after the Gujarat earthquake will continue for the next two or three years. There are funds and soft loans available," he said.

The January 26 quake killed at least 30,000 people and caused damages worth at least Rs 200 billion ($4.3).

Prime Minister Atal Bihari Vajpayee has said the budget would include more taxes to rebuild Gujarat. The government has already imposed a two per cent surcharge on all income to raise Rs 13 billion in reconstruction funding.

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