The immediate priority, he told finance ministry officials, is "to manage balance of payments for which all policies should be directed to help institutional flows to India", according to a tweet from the Prime Minister's Office (PMO).
"In the short run we need to revive investor sentiment, both domestic and international," Mr. Singh told finance ministry officials, the PMO said.
The Prime Minister, who is known for unleashing India's first round of economic reforms in 1991, also directed the officials to "revive the animal spirit in the country's economy".
Earlier, during his first day of taking additional charge of the finance ministry, Mr. Singh met with key finance ministry and policy planning officials to put together a mechanism for the ministry to coordinate with his office, and to discuss the challenges facing the economy, they added.
Mr. Singh reviewed the financial situation with the officials, which included all five secretaries from the ministry and its economic adviser Kaushik Basu, sources said. He also asked the secretaries for solutions to improve the current economic scenario, the sources added. They declined to be identified because of the confidential nature of the discussions.
Earlier in the day, the Prime Minister also met with the chairman of his economic advisory council C Rangarajan and Planning Commission deputy chairman Montek Singh Ahluwalia.
The discussions centred around the balance of payments situation, current account deficit, rupee movement, investment climate and growth imperatives, these sources said.
“We discussed issues related to the economy,” Mr. Rangarajan told NDTV Profit.
Mr. Basu’s term ends on July 31 but the Finance Ministry has not yet announced a successor or if he will be given an extension. He is already on an extension, and if the Prime Minister wants, could be given another one.
On Tuesday, Finance Minister Pranab Mukherjee put in his papers to run for President of India, the highest office in the country, saying he was “ready to embark on a new journey”.
Mr. Singh faces a slew of challenges, key among them slowing growth, rising inflation, a ballooning fiscal deficit and a falling rupee.
The toughest challenge for the Prime Minister is to push growth back to at least the 7 per cent levels. The Budget estimate for the current fiscal is 7.6 per cent, with a margin of error of around 0.25 per cent. With GDP growth dipping to 6.5 per cent last fiscal, and a nine-year low of 5.3 per cent for March quarter, reviving growth will likely be a priority.
Additionally, he must also take steps to boost investor confidence, which has taken a hit after the introduction of retrospective tax laws, and the new General Anti-Avoidance Rules (GAAR).
The monsoon this year has also been weaker than usual, raising concerns that agricultural output could fall, putting more pressure on the government to raise minimum support prices for crops. This, in turn, could push the subsidy bill higher. A poor crop could also force farmers to opt for the national jobs programme, the Mahatma Gandhi National Rural Employment Guarantee scheme, which would also push up the government’s expenditure and add to the deficit.