Describing the two-year tenure of the Prime Minister, Mr Narendra Modi’s Government as ‘work in progress,’ apex industry body ASSOCHAM today said that country’s big macroeconomic picture has certainly been steadied while some bold moves have been made in the roads and highways, railways and energy sectors earning seven out of ten ranking from India Inc on the performance chart.
“The ASSOCHAM assessment about the NDA Government on completion of its two years is based on interactions and feedback of the cross section of industry leaders from manufacturing, banking, real estate, trading and infrastructure industries,” said The Associated Chambers of Commerce and Industry of India (ASSOCHAM).
ASSOCHAM president, Mr Sunil Kanoria said, “The leadership of Mr Modi clearly stands out in certain critical areas like the foreign policy and push to the infrastructure sectors, however, the industry would expect consideration traction in disinvestment, resolution of taxation disputes, agriculture reforms and most importantly the GST Bill.”
“While laudable work has been initiated in the key infrastructure areas like highways, power and the railways, aggressive approach would now be required in the challenging sector of agriculture and the entire rural landscape, which is passing through crisis,” said Mr Kanoria.
“The rural population needs immediate helping hand. As far as macro economy is concerned, India has no doubt it will come out a lot more stable and strong as compared to the summer of 2014. Finance Minister, Mr Arun Jaitley and the Reserve Bank of India (RBI) Governor, Dr Raghuram Rajan did commendable work in terms of bringing about a stable exchange rate, drastic reduction in current account deficit and moving some of the key legislative reforms such Bankruptcy Law, Real Estate Regulation. However, lot more is required as for as the tax disputes and litigation is concerned,” said the ASSOCHAM chief.
He said while the industry would always want lower and still lower interest rates, a lot of credit must be given to the RBI Governor for slashing the policy interest rates at least by 150 basis points over the last 15 months, though the banks did not pass on the same to the consumers.
“In a situation when the central bank is mandated to do inflation targeting, its main task becomes inflation calibration, which ultimately leads to sustainable growth,” said Mr Kanoria.
He said, “It would be only fair to call the NDA Government as work in progress since it would take time before the projects in sectors such as railways and highways bear fruit. However, the bigger area of concern remains the huge toxic assets of the public sector banks, mainly because of business downturns. The government and the RBI, both need to handle the issue of non-performing assets (NPAs) with extreme care and the banks should be empowered to take the commercial decisions in case of stressed assets without any fear of facing reprisals on post-mortem of their actions at a much later date.”
One of the sticking points has been the non-passage of the Goods and Services Tax (GST) Bill, which does not appear to be happening any time soon either, given the surcharged political environment and the back to back elections in the state assemblies. “Efforts must continue to reach out to the principal opposition party while the Congress Party must also rise above the political considerations alone for the good of the nation.”
In crucial sectors such as health and education, the India Inc does not rate the performance as much as was expected. “Both these areas are critical for the human resource. While the Skill India and Start up India area great moves along with the Jan Dhan Yojna, much more is required in providing adequate and quality education. Besides, the public expenditure in health sector needs go up and dependence on insurance alone would not be sufficient.”
Mr Kanoria wished very fruitful years ahead for the Prime Minister offering full industry support for nation building.