Foreign Direct Investment needs to be encouraged: President

Praising the performance of the Manmohan Singh Government for being able to accelerate economic growth in the past five years to a record average of 8.5 per cent, President Pratibha Devisingh Patil today emphasised the need to encourage foreign direct investment "through an appropriate policy regime", and said the government would bring a legislation to establish a regulator for the pension sector.

Addressing the joint session of Parliament, the President said the country had benefitted from large foreign investment flows in recent years and it would be encouraged through an appropriate policy and stressed the need for augmenting resources in the banking and insurance sectors to serve the needs of society better.

Besides, the Government, she said, would recapitalise the public sector banks to strengthen their financial position and also bring legislation to establish a regulator for the pension sector to achieve these objectives.

Referring to the Government record growth of 8.5 per cent, the President said this resulted in impressive expansion in high quality jobs, also enabling the government to guarantee rural employment and expand social and economic infrastructure in an unprecedented manner.

Similarly, the government also performed well in agriculture sector by increasing public investment in this field and in education it expanded the access by opening new schools and educational institutions, she added.

Despite a slow down in growth in the current financial year on account of global recession, the government, she said, responded to the situation with a number of measures, including three stimulus packages, which had begun to show results.

At the international level, especially through the G-20 forum, the government was emphasising the need for global coordinated action to bring in necessary reforms to meet the situation, she added.