RPT-WRAPUP 1-India to push ahead with reforms; welcomes inflows

(Repeats story issued late on Wednesday)

* India welcomes foreign inflows

* Stocks surge as fiscal stimulus to remain in place

* Govt to move SBI, insurance, pension reform bills-official

* No move to allow foreign firms in multi-brand retail

By Rajesh Kumar Singh and Tony Munroe

NEW DELHI, Nov 4 (Reuters) - India will push ahead with financial sector reforms, which will not destablise growth, and can absorb a welcome rise in foreign investment flows, a top policy adviser said on Wednesday.

Indian stocks .BSESN rallied 3.3 percent amid a global rally, a day after the finance minister said fiscal stimulus measures would remain in place to ensure economic recovery.

Montek Singh Ahluwalia, deputy chairman of the Planning Commission and a close aide to the prime minister, also said food price inflation was a concern but it should moderate by the end of this year.

Addressing the annual economic editors' conference, Ahluwalia said a rise in foreign investment flows into Asia's third-largest economy were good, but authorities would keep a vigil on short-term debt flows.

"I think we can absorb those foreign investment flows. Obviously we will remain watchful on flows of short-term debt and so on, but a revival of foreign investment flows is very welcome," he said.

Between April and September, the first half of the 2009/10 fiscal year, foreign direct investment was in excess of $15 billion and portfolio investment were almost the same, Trade Minister Anand Sharma said at the same event. [ID:nBMA006347]

With Western economies still crawling out of recession and interest rates at or near historic lows, funds have been flooding into faster-growing Asian markets, helping to drive up stock and property prices and prompting central banks, including India's, to take steps to curb a surge in real estate prices.

The influx of foreign funds is also pushing up the rupee INR=IN. The Reserve Bank of India has said there was a risk that if it raised interest rates ahead of other central banks, it could attract more inflows and complicate policymaking.

Foreign investors have bought more than $14 billion of local equities in 2009, after selling $13 billion in 2008, helping send stocks 65 percent higher.

Brazil, faced with a similar surge in risk-hungry capital, last month imposed a 2 percent tax on foreign investments in local stocks and bonds.