Pranab meets FIIs to soothe nerves in view of sell-off plans

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With slowdown in FII investment in equities looming over government's Rs40,000 crore sell-off plan, Finance Minister Pranab Mukherjee on Tuesday met institutional investors and asked them to stay optimistic on India.

At a meeting with a group of 30 Indian and Foreign Institutional Investors (FIIs), Mukherjee said the economy is expected to clock 8.5 per cent growth this fiscal and the revenue collections would be on course.

"There need not be any undue fear on the issue of fiscal deficit," he said.

There have been concerns that government will find it difficult to meet Budget targets of fiscal deficit and revenue collections because of inflationary pressures and global economic uncertainties.

Asking them to take a long-term view of the economy without being disturbed with the short-term data, the Finance Minister said the investors should ‘remain optimistic.’

On concerns over Rs40,000 crore disinvestment plan for this fiscal, he said: "It would be too pre-mature to reach a judgement as only the first two months of the current financial year have gone by."

The follow-on-public offer (FPO) of steel major SAIL has been delayed due to uncertain stock market conditions. The government has been able to raise only Rs1,145 crore from the PFC issue.

Sensex has lost by over 2,000 points or 10 per cent so far in 2011 on worries over inflation impacting domestic growth, which could also be affected by global uncertainties.