IPO not disinvestment: Chidambaram

Karaikudi, Tamil Nadu, Feb 9 (UNI) Allaying the apprehensions of the Left parties, supporting the UPA government from outside, Finance Minister P Chidambaram today played soft on the IPO issue saying it was not the same as disinvestment.

Talking to newspersons after inaugurating a branch of the Andhra Bank here, he made a distinction between the two and said there was no compulsion on the three PSUs to go in for the IPO. However, the issue would be explained to the leaders of the Left parties, he added.

Denying that the Left was opposed to the reforms per se, the minister clarified that there was no antagonism as it was being made out. While External Affairs Minister Pranab Mukherjee held discussions with the CPI(M) leaders, he himself (Mr Chidambaram) held dialogues with the top brass of CPI and clarified the government's position, he said.

On the importance of IPO, on which the government was riding piggyback, he said this was necessary to mop resources for the NIF.

To a question, the finance minister denied that online trading was responsible for the spiraling price rise. Some of the 'thin commodities', the price of which had gone up after being listed for online trading, had been withdrawn, he admitted.

In his opinion, price hike would ease once supply witnessed increase as it was spurred by supply constraints. Containing inflation also would help stabilise it, he added.

To another query on growth rate, he said the expectation was nine per cent and above. The current rate of 8.6 per cent was unprecedented, he noted and said more reforms were needed to sustain the momentum. That was why the UPA government had promised more reforms.

Stating that growth of the manufacturing sector had accelerated from a mere six per cent to 11.3 per cent, he said growth rate of agriculture, still remaining an average of 2.9 per cent, should be at a minimum of four per cent.

Earlier addressing the function, Mr Chidambaram maintained that credit was a driving force behind economic growth. Stating that growth in credit had registered 30 per cent, he said even the RBI, which had stepped in to restrict lending to certain areas to contain inflation, had left the priority sectors.

Agricultural credit, which was promised to be doubled every year, would cross the two lakh crore rupees target by March next year, he added.

UNI