Finance minister Yashwant Sinha today disclosed that more proactive economic policies for NRIs including the question of NRIs being treated on par with Indian nationals in the economic field would be announced shortly.

The overwhelming response to the Resurgent India Bonds which garnered 4.16 billion dollars from overseas Indians indicated a measure of confidence of not only NRIs but also the world had on India, he said in a interview to PTI.

The success of RIB has effectively "shut up the so called prophets of doom and gloom who were preaching after the Pokhran tests, Moody's downgrading and after the BJP budget that India had no future," he said.

Sinha said he had talked about introducing the Persons of India (PIO) origin cards for NRIs in the budget. "We are in the process ofimplementing it," he said to a question on whether government was moving towards granting dual citizenship for NRIs.

Sinha termed as absolutely wrong the Congress criticism that RIBs were raised at high cost. It is only the economic illiterate people who say this, Sinha said. ``We had offered a rate of interest of 7.7 per cent. This is one of the cheapest any developing country had offered to raise such a large sum of money for a five year period,'' he said.

International commentators have also said that no other developing country could have got it at this cost. We have examples of other developing countries paying much higher rate of interest than the RIBs. "So it is wrong to say we have raised the RIBs at high cost," he said.

Sinha expects recessionary trends to start tapering off by this month-end and voiced hope that there would be a "definite upturn" in the economy by the year end.

"I am hopeful we shall start noticing the turnaround when growth figures for September come and by the end of theyear there will be a definite upturn in the economy," he said in an interview here.

Sinha said the strategy to reverse recessionary trends was to stimulate demand by increasing government spending in public and private sector especially in areas of agriculture, rural development and infrastructure.

"Time to spend is coming," he said admitting the slowdown in the economy was due to industrial recession which had hit sectors such as steel, cement and commercial vehicles.

He said because there was deceleration in agricultural production last year it had created problems of demand in other sectors like textiles. The paper industry is also having some problems. "Therefore, our strategy is to stimulate demand by larger expenditure in both public and private sectors," he said.

The finance minister said the biggest challenge faced by the BJP government was to steer the economy out of this difficult situation.

At this point of time, there are mixed signals. Some sectors of the economy are showing signs of anupturn while some others continue to stagnate. Exports, which have fallen sharply in the first quarter of this year, have started picking up in July.

Admitting that the near 8 per cent inflation rate was not sustainable, Sinha said it was largely due to seasonal factors and it was now showing signs of decline.

The overall domestic economic situation has some promising signs with corporate and income-tax collections as well as excise and customs duty collections beginning to show a positive growth after a disappointing first quarter, Sinha said.

But the present state of the economy calls for a very "skillful management" specially in view of the turmoil which has overtaken some of the major economic players in the world.

Sinha said the BJP government had inherited an economy which was in the throes of a slowdown, the first signs of which were discernible in June 1996.

The slowdown had worsened immediately after the BJP assumed office in March and presented the interim budget in parliament. "I hadgiven the facts and figures (interim budget) which had described the deteriorating economic scenario," he said.

Sinha said the centre's fiscal deficit overshot to 6 per cent of GDP as against the budgeted 4.5 per cent of the GDP in 1997-98. In absolute terms, fiscal deficit had gone up by over Rs 20,000 crore in one year.

Exports grew by a meagre 2.5 per cent. Both industrial and agricultural production were down as a result of weak overall economic growth which had decelerated to 5 per cent of GDP, he said.

Inflation, after touching a low of 3.37 per cent in August 1997, was on a rising curve. The present rate of about 8 per cent was not sustainable and was largely on account of seasonal factors.

Agricultural production was down by 2.5 per cent last year and even in the pre-kharif season it had suffered on account of excessive heat wave conditions.

Despite problems of inadequate rains in some parts of the country and excessive floods in other parts, the overall agricultural prospects in the kharifseason appear promising so far. "It is our hope when the new crop comes in the market, prices will go down appreciably," he said.