M.M.Khanna,
INVC,
Chandigarh,
Confederation of Indian Industry (CII) has called for rapid state level reforms and easing of interest rates at the earliest to revive the economy. Addressing a press conference at CII NR Headquarters here in Chandigarh on Friday, to unveil the CII theme for 2013-14, the newly elected CII President, Kris Gopalakrishnan, Co-Founder and Co-Chairman, Infosys Limited, highlighted that ‘In order to attract investments and accelerate growth, it is essential to speed up the state level reforms like early implementation of Goods and Services Tax (GST) & adoption of Model APMC Act in Agriculture by denotifying fruits, vegetables and other perishables from the APMC list, Procedural reforms by using Information & Communications Technology to enhance ease of doing business and transactions in states, Distribution reforms in the power sector with special focus on Public Private Partnership (PPP) mode, Land reforms in Agri sector to enable farmers to lease out their agricultural land for cultivation while still retaining the ownership rights, skill development programmes, FDI etc”. “CII will set up a Central Task Force to monitor State level Reforms”, he further added. CII has finalized ‘Accelerating Economic Growth through Innovation, Transformation, Inclusion and Governance’ as the Theme for 2013-14. This is in line with the national priority of generating revenues for social programs for inclusive growth. According to CII’s analysis, GDP growth for the year is projected in a possible range of 6.0 to 6.4%. Industrial growth is likely to recover, given the low base of the previous year, but will probably remain at 5.0-5.5%. Agriculture is forecast to grow at its average pace of 2.5-3.5%. Growth in the services sector will recover but is not likely to accelerate beyond 7.2-7.5% in the light of fragile global conditions. Widening Current Account Deficit and Fiscal Deficit are also the causes of concern in addition to various investment bottlenecks. “CII hopes that the reforms at centre are executed at good pace. Huge investments are needed in key sectors like infrastructure, power, oil and gas etc. We feel that there is a need to open our economy more and give more space for FDI”, iterated Mr Gopalakrishnan. Emphasizing on the need to accelerate economic growth, the CII President suggested aiming for a growth rate of 8-9% in the next two years through kick starting investment and consumption demand. The Reserve Bank of India needs to work in tandem with the Government in boosting growth by easing interest rates by at least 100 basis points (bps) in the current fiscal. Reviving stalled projects is a critical precursor for facilitating higher overall investment. He therefore stressed on the need for the Cabinet Committee on Investment (CCI) to aim for making a repository of the top 50 stalled projects in terms of the investment incurred and go for their revival on a priority basis. Also, streamlining procedural reforms is another major step for India to catapult itself to the high growth trajectory”, Kris added. In addition, Mr Gopalakrishnan also highlighted the need to increase investor confidence and increase investments by aiming for fiscal consolidation, maintaining the momentum of economic reforms and allowing FDI in critical sectors such as Insurance & Banking. Start up activities need to be also increased by announcing measures to foster entrepreneur spirit, he emphasised. Elaborating on the proposed CII Agenda for Innovation, he stated that the Industry investment in R&D, Innovation and Design needs to increase significantly. To increase industry investments significantly from the current extremely low levels of 0.3% of GDP, an enabling policy framework is imperative. For instilling innovation in the DNA of a company, CII has developed a framework, the Industrial Innovation Framework, which measures an industry’s innovation readiness. For investing in R&D, the industry can also tap Global Innovation and Technology Alliance (GITA), a joint venture between the Government and CII, which extends financial support in the form of soft loans/grant for R&D projects. As Entrepreneurs and Start-ups are India’s future, CII has proposed an ‘India Start-Ups’ group to encourage entrepreneurs. For Transformation, another key enabler for economic growth, Mr Gopalakrishnan briefed on some of the specific CII interventions planned for the year. CII through its India@75 initiative will be working with the Planning Commission on India Backbone Implementation Network (IBIN) for bridging the gaps identified by various agencies in the delivery system thus endeavoring to improve efficiency of the implementation process. CII is also working through it’s City Connect Programme under India@75 on indexing of approximately 441 class I Indian cities on 12 parameters. The indexing is intended to create traction for participative development with provision of gap analysis and technology driven solutions. A new initiative called “Project Village Budha” is being launched this year targeting to take the idea of Kaizens (small improvements) and enable implementation in a village environment. The objective would be to help earning power of people in the villages through a structured programme for large, medium and small companies from all sectors. In addition, CII’s ongoing initiative, the Visionary Leaders for Manufacturing Programme which is transforming manufacturing companies will be expanded. A special programme for MSMEs, the “Golden Top 100 SMEs” will also be launched this year which will work with targetted SMEs through a structured programme and become contributors to Indian SME growth. Inclusion has been one of the key pillars of CII. This has taken shape in the form of CII interventions towards upliftment of marginalized people, SC/STs, women, disabled, informal workforce & backward geographies. Mr Gopalakrishnan briefed that CII would catalyse structured CSR initiatives by corporates and work with the government to align development initiatives with UN Millennium Development Goals. Taking forward its 4Es (Education, Employability, Entrepreneurship and Employment) program for Affirmative Action, CII would expand its scholarships and vendor development programs. In 2012-13, CII member companies offered scholarships to 32,000-plus SC/ST students and trained over 41,000. More job fairs to place SC/ST candidates with CII members are planned. The online job portal with NACDOR will be widely disseminated. CII will also set up 3 Sector Skill Councils, 4 Skill Hubs and 17 CII-PanIIT Skill Gurukuls to take forward its wide range of skills efforts. On the issue of Reforms & Governance, CII would continue its advocacy efforts on implementation of the GST regime and also on the Direct Tax Code. Separate Task Forces are being constituted to monitor State level reforms and another one to suggest easier business regulations. CII would also monitor implementation of select Infrastructure projects of national importance. On governance, Mr Gopalakrishnan stressed the need for independent regulatory authorities in sectors of scarce resources like coal, real estate, health etc. There is a need to implement and enforce immediately the recommendations of the Election Commission, Law Commission and judiciary in respect of candidate’s disqualifications at entry threshold. CII will continue to engage with the Government and political parties on FDI in critical sectors such as insurance and pension funds. Emerging markets emphasis, multilateral engagements and continued business missions would boost exports, help source raw materials and ensure food and energy security. A review mechanism is needed to study existing Free Trade Agreements and domestic industry considerations should be highlighted in new FTAs, recommended CII. Slowing manufacturing sector deserves special attention, feels CII. Labour reforms to create employment and rationalize inspections are urgently needed. National Manufacturing Policy should be implemented speedily by converging land acquisition, project clearance and streamlining regulations. In Infrastructure, an Independent PPP Commission, access to financing, effective dispute resolution mechanism, etc are required, said CII. For Agriculture, CII has suggested reforms to incentivize implementation of the Model APMC Act and promote mechanization, and long term policies to encourage private sector participation in procurement, storage and distribution of food-grains.
