For a document that undisputedly chiselled the first contours of India's post-independence economy, the Bombay Plan of 1944-45 went surprisingly unacknowledged. Jawaharlal Nehru never officially accepted the Plan even though the first Five Year Plan was remarkably similar to it.
Sixty seven years later,mSix business leaders, Deepak Parekh, chairman of HDFC, KV Kamath, chairman, ICICI Bank and Infosys, Ashok Ganguly, former chairman of Hindustan Unilever, Sunil Bharti Mittal, chairman, Bharti Enterprises, Zia Mody, legal firm AZB Partners, NR Narayana Murthy, founder Infosys Technologies, crafted the Agenda For Renewal at ET's invitation.
The people of this country should urge opposition parties not to add fuel to the negativism that is prevalent and more importantly support the government in some of the important bills that are pending. The opposition needs to have a more mature outlook of the future of the industry.
There are certain things the government wants to do, but the opposition is not allowing them to do it. Businessmen should demand better performance not just from the government, but also from the opposition. Doomsday forecasters and agitators should not be allowed to hijack the country. The sense of victim hood needs to be replaced with optimism and confidence.
There are certain things the government wants to do, but the opposition is not allowing them to do it. Businessmen should demand better performance not just from the government, but also from the opposition. Doomsday forecasters and agitators should not be allowed to hijack the country. The sense of victim hood needs to be replaced with optimism and confidence.
A policy paralysis at the centre, controversy over several past decisions on national resources, lack of clarity in many areas are all causing frustration among domestic and foreign investors. For example, global mining majors Rio Tinto and BHP Billiton mine in the remotest part of Africa, Russia, China but not in India.
Companies without money or technology are using political contacts to get mining licenses, but global firms with both are not here. At the same time, there is controversy about national resources -- e-auctions for all government resources are the way forward. Everything needs to be made transparent and foolproof. This has been done in some cases, the latter rounds of spectrum auction, for example. Learning from such cases needs to be applied in all areas to inspire investor confidence.
Companies without money or technology are using political contacts to get mining licenses, but global firms with both are not here. At the same time, there is controversy about national resources -- e-auctions for all government resources are the way forward. Everything needs to be made transparent and foolproof. This has been done in some cases, the latter rounds of spectrum auction, for example. Learning from such cases needs to be applied in all areas to inspire investor confidence.
India needs modern retail. There could be an argument about FDI in retail, but there is really no debate about the need for modern retail. Cold-storage and faster movement of perishable commodities will help farmers and consumers. All of this could be done without FDI, but the entry of Carrefour, Walmart, Tescos of the world will make this faster.
While big moves like opening up FDI in more sectors will create an environment that is conducive to foreign investment, India also needs several smaller improvements like easier visa and immigration rules, faster permission for chartered flights and business jets of global executives to land. India should make foreigners and companies feel that it is easy to do business here.
While big moves like opening up FDI in more sectors will create an environment that is conducive to foreign investment, India also needs several smaller improvements like easier visa and immigration rules, faster permission for chartered flights and business jets of global executives to land. India should make foreigners and companies feel that it is easy to do business here.
India cannot have a higher growth without adequate power. We are facing enormous power problems. Bank lending to the sector is at an all-time high, but some projects that have borrowed money are stalled due to land, raw material and infrastructure issues. In the 12th five-year plan outlay of a trillion dollars, almost 45% is to be spent on energy. For this money to be well spent, many issues have to be resolved.
Some states have not increased power tariffs for a decade and are now unwilling or unable to buy power from private generators; there is under-recovery and theft; part of the system is completely market oriented and part of it is completely distorted by policy initiatives, like subsidies. Subsidies are required, but they should be directed well.
Some states have not increased power tariffs for a decade and are now unwilling or unable to buy power from private generators; there is under-recovery and theft; part of the system is completely market oriented and part of it is completely distorted by policy initiatives, like subsidies. Subsidies are required, but they should be directed well.
There have been hardly any reforms in agriculture. Marketing laws are out dated, distribution and logistics from the farm gate to the food plate are filled with inefficiencies and corruption. The cost the consumer pays is far too much and the price the farmer gets is far too less. This is why food inflation is high even though monsoons are good, output for food grains, oilseeds, vegetables, pulses, etc are at a record high and agriculture has grown 3-4% in the last couple of years.
There is an elephant in the room, the APMC monopoly, which the government is not acknowledging. (Agriculture Produce Market Committees run by state governments regulate the marketing of farm produce.) Some states have modified or scrapped APMC acts, but many do not allow retailers to buy directly from the farmers.
There is an elephant in the room, the APMC monopoly, which the government is not acknowledging. (Agriculture Produce Market Committees run by state governments regulate the marketing of farm produce.) Some states have modified or scrapped APMC acts, but many do not allow retailers to buy directly from the farmers.
About 70% of India's GDP in 2030 will come from cities, according to McKinsey Global Institute. At least five major states will have more than 50% of their population living in cities. Demand for urban land will rise from 7.5 million hectares in 2007 to 18.6 million hectares. But India is not creating enough new cities. State governments are disinterested or incapable.
Mumbai is referred to as the Shanghai of India, but infrastructure is poor and there is hardly any urban reform. To renew cities, we need more public-private partnerships because all capabilities do not lie only in the state or only in the private sector. The facts are clear. The case is compelling. What is needed is leadership and a sense of urgency.
Mumbai is referred to as the Shanghai of India, but infrastructure is poor and there is hardly any urban reform. To renew cities, we need more public-private partnerships because all capabilities do not lie only in the state or only in the private sector. The facts are clear. The case is compelling. What is needed is leadership and a sense of urgency.
Delays and controversies pertaining to acquisition of land have time and again delayed projects in power, mining, auto and other sectors. Often, there has been intense conflict between business, the state, and farmers or locals. A clear, equitable and transparent policy can help avoid such conflicts.
Such solutions, including giving portions of developed land for the farmers or locals who have given up their land, annuities and jobs, in addition to up-front compensation, are possible and have indeed been tried out.
Such solutions, including giving portions of developed land for the farmers or locals who have given up their land, annuities and jobs, in addition to up-front compensation, are possible and have indeed been tried out.
India's economic growth could be higher by at least two percent if the various ministries in the central government co-ordinated better with each other, according a one CEO who helped draft the Agenda for Renewal. Ministries sometimes take a rigid stance on issues, but better communication can soften such stances.
Factors like high interest rates have come in the way of growth, but constraints arising out of government policy and actions have made the environment more difficult. For example, better co-ordination between the power, environment and coal ministries could have helped many power projects get underway faster.
Factors like high interest rates have come in the way of growth, but constraints arising out of government policy and actions have made the environment more difficult. For example, better co-ordination between the power, environment and coal ministries could have helped many power projects get underway faster.
Schools generate $20 billion every year, and the figure is growing at 14% a year, according to Kaizen private equity's education report. But education in India is not allowed to function as a for-profit business. The government mandates a 'trust' structure for all schools from kindergarten till class 12. So, only non-profit trusts can operate schools; and if a trust has a surplus, it has to reinvest it in the school it runs.
That's the rule on paper. In reality, companies and investors work around this by setting up `consulting companies' to provide services to schools in return for a fee. This arrangement makes a mockery of the trust structure. Education should be allowed to run as a business. The foreign universities bill also needs to be passed.
That's the rule on paper. In reality, companies and investors work around this by setting up `consulting companies' to provide services to schools in return for a fee. This arrangement makes a mockery of the trust structure. Education should be allowed to run as a business. The foreign universities bill also needs to be passed.
No comments:
Post a Comment