India Would Witness Strong Growth Despite Global Challenges : CII President

Mumbai : CII predicts 7.3-7.7 percent growth in 2018-19 and expects it to strengthen further in the few years to come. This in spite of some challenges in the global economy, including hardening of interest rate regimes, volatility in oil prices, etc, said Mr Rakesh Bharti Mittal, President, CII addressing a Press Conference here on June 12.

The reforms over the past 4 years was mentioned by Mr Mittal and he further stated that GST and Insolvency and Bankruptcy Code are the most relevant reforms that would change the way business is done in the country.

Alluding to the intensive amount of work on ease of doing business that is happening across states, the CII President said that state governments working proactively on EoDB are getting better investments and business interest and the Government of India’s ranking of states plays a good role in this.

Responding to a question on how are the large NPA accumulation to be dealt with, Mr Mittal said that CII has been propagating setting up of a very large Asset Reconstruction Institution or a “bad bank”, which would help clean up the banking system of the stressed assets and allow for unfettered credit flow.

Alluding to credit growth, which has picked up after a long period, the CII President said that this was a most welcome feature. However, he added that many SMEs are still struggling to get credit and even when they do, their cost of credit is high making their business operations difficult.

On job creation, Mr Mittal went on to say that while new jobs have been created in the formal sector itself, there are many more created in the informal sector and these are not being tracked. As an example he mentioned that huge growth in MUDRA loans, which indicate the livelihood creation in sectors, which are mostly out of the statistical radar. Staying on the same subject Mr Mittal mentioned that owing to reforms like demonetization, GST, etc, numbers of employment creation in the informal sector are slowly moving to the formal sector. In the same vein of government reforms for easing business, Mr Mittal mentioned that the Fixed Term Employment regulation has the potential transform job creation in the country and is a very good policy for industry.

On greater inclusion as an agenda for industry, the CII President mentioned that CSR activities would be a focus for CII this year.

Alluding to the farm sector, Mr Rakesh Bharti Mittal said the news that the Government was planning to launch ranking of states on agriculture reforms was a great one. In order for the government to achieve its target of doubling farmers’ income, focus has to be on rural infrastructure, land/ power reforms, water management, icro irrigation, moving to high value crops, farmers’ freedom to sell directly food processors/ retailers in addition to APMC markets. These would lead to large scale private sector investments and increase in farmers’ income, Mr Mittal added.

Speaking at the same Press Conference, Mr Uday Kotak, President Designate of CII mentioned that compared to 4 years back there is a reversal in the macro and micro situation. The micro situation is far stronger than 4 years back on the back of robust demand. While the macro challenges like hardening interest rates, volatile oil prices present a more challenging macro.

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