NEW DELHI, Nov 1: The Indian economy is on a “satifactory growth” track despite the fallout of the terrorist attacks on the United States, Finance Minister Yashwant Sinha said on Thursday.

Sinha admitted the economy was passing through a difficult phase due to the combined effects of the global slowdown and September 11 atrocities in New York and Washington, but expressed confidence it would pull through.

I am confident that given our own large market, subcontinental dimension, resources and resilience of the economy, it is possible to overcome the challenges and achieve a growth rate which will be satisfactory, Sinha told an insurance summit.

Sinha promised Thursday to introduce labour law reforms to give companies greater freedom in their operations.

This is the most difficult area of market reforms there is tremendous opposition. But we are determined to move ahead.

The finance minister said the government was counting on insurance and pension funds to boost the economy and make more money available for infrastructure development, particularly road development.

Opening up the insurance sector has proved to be a powerful fillip for the growth of the public sector, energising it into action, said Sinha.

He said the Insurance Amendment Bill currently before parliament would facilitate e-transactions and allow policyholders to make payments through automatic teller machines and credit cards.

Sinha said private insurance firms had “a great scope” for doing business by tapping the small savings of Indian households, which accounted for 19.8 per cent of gross domestic product in 1999-2000.

India recently handed out the first set of licences to private insurers, breaking five decades of state monopoly.

Government rules stipulate private insurance companies should be capitalised at a minimum of $20 million, of which a foreign partner cannot hold more than 26 per cent.

Only five per cent of India’s one billion people have life insurance and a 200-million strong middle class offers huge opportunities for investors in the sector.—AFP