Prime Minister Manmohan Singh on Wednesday admitted there was ‘inadequate preparation’ on the issue of allowing FDI in multi-brand retail, a reform which has been suspended, and he also said that some partners in the UPA coalition developed ‘cold feet’.
Singh indicated that he hopes to revisit retail reforms after March, by which time Assembly elections in five states including Uttar Pradesh and Punjab are expected to be over and Government hopes that inflation will ease.
"There was inadequate preparation and some partners in the coalition developed cold feet," he told Bloomberg.
Singh at the same time held out an assurance that his government will do everything to encourage foreign investment.
"...I can assure you, India remains committed to a system of regulation that is supportive of enterprise and we will do everything to encourage foreign investment," the Prime Minister said.
Last month, the government had to put on hold its decision to allow 51 per cent FDI in multi-brand retail following stiff opposition from some of its allies like Mamata banerjee's Trinamool Congress and other political parties.
State elections are scheduled early next year in UP, Punjab, Uttrakhand, Manipur and Goa.
Singh also expressed confidence that India's economy will return a long-term growth pace of 9 per cent.
"We will stay the course," he said adding "we will make India an eminently bankable and credit worthy economy."
The economic growth in the current year is likely to moderate to 7.5 per cent from 8.5 per cent in the last fiscal.