Growth to be back by October, predicts Basu

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Chief economic adviser Kaushik Basu said Friday the government was trying hard to remove “trust problems” with industry. “We want to work hand in hand with industry.

There is element of trust problem between industry and government... We’ll try to correct this as much as possible in coming months.”

Dr Basu expressed the hope that economic growth will rebound from October this year, with inflation starting to moderate from September, if some reforms went through. “We will have to get a couple of reforms in place... The big stumbling block has been getting all political parties in the coalition together,” he said.

Asked if former finance minister Pranab Mukherjee’s tax policies were being changed, he said: “I don’t think any (recent) policy step has been diluted.”

The Prime Minister’s Office, meanwhile, clarified Friday the draft GAAR guidelines by the finance ministry Thursday would be finalised only after Dr Manmohan Singh gave approval.