While these statements excited the industrialists present at a gathering organised by the Federation of Indian Chambers of Commerce and Industry (FICCI), it was unclear when the measures would be implemented.

Sinha said the Government was planning to expand the automatic route for foreign investment approvals to include all sectors. ``Once all the policies for each sector are in place, no one will have to come to the Government. Everything will be cleared by the Administrative Ministry or the RBI. Clearances which take 60 or 90 days will be a thing of the past,'' he said.

Sinha said there were a number of issues which the Government was looking at and would act upon to ensure that India could face the challenge of competition and globalisation. First of these wasmarket-oriented pricing and tariffs. ``It will be difficult for the Government to withdraw from the pricing of sensitive products. But it must withdraw and let the market forces take over,'' he emphasised. He did not indicate any time-frame for this.

He added that market pricing would be of little use if India did not break down the tariff barriers between the states. He said the need of the hour was to create a common market for India especially for agricultural products. ``Unless there is free movement of products across the country, market forces will not be able to determine the price,'' he said. With market barriers breaking between nations, there was no reason for not having a common market in India, he said.

On the issue of reservation to small scale sector, he said the Government will have to weigh the advantages of continuing with reservation. Indicating that he was in favor of removing the reservation, he said that global events would overtake policies like reservations. ``Can we carry on withthe policy of reservation in the light of globalisation and trading blocks?'' he asked industrialists. He said that the small scale sector was important but would be swept away by global trends, if it did not prepare for the future.

Sinha said the Government and industry should discuss and bring a National Policy on Voluntary Retirement Scheme which would cover both the public and the private sector. He said the labour laws were rigid and something had to be done about it. The trade unions would be taken into confidence before finalising the policy, he said. It was important that a strong safety net be built to support workers.

The Finance Minister promised to bring in a world class financial system for Indian industry to enable it to compete with the world. ``We will take steps to ensure that the domestic interest rates do not remain many times higher than the rest of the world,'' he announced. This was one way of tackling the dumping of products by other nations.

Making the usual genuflection towardscurbing fiscal deficit, Sinha said that Government expenditure would be reduced. There would be a cap on government borrowing to introduce discipline. ``I have told a group of secretaries that if they ask for extra allocation next year, my answer would be that I have no money. My pockets are empty,'' he said.

However, the minister remained non-committal over how the government would bring into effect buy back of shares by companies. Asked if the Government would promulgate an ordinance, he said, ``it is for the Cabinet to decide.'' Vajpayee had yesterday announced that the government proposed to permit companies to buy back their shares.

Cap to be put on Govt borrowings