The Hindu Business Line : Rupee surge needs to be checked: FICCI

The President of the Federation of Indian Chambers of Commerce and Industry (FICCI), Mr Habil Khorakiwala, today said “if the rupee appreciation is not checked in the next three to six months and this continues for a year or more, it will have an adverse impact on industrial growth and GDP.”

He said the problem is fundamentally on the supply side. The growth in food related prices is fuelling inflation which has to be managed in the long run by increasing the overall output.

Speaking on the sidelines of FICCI national executive meeting here today he hinted that the RBI had managed it efficiently earlier and they now expect it to tackle the issue in a similar manner.

The Executive Council of FICCI, where over 75 chief executive officers of companies from about 38 sectors including technology and manufacturing, are meeting here.

On reservation in the private sector, Mr Khorakiwala said society had already been divided on the lines of reservations and asked why should it be allowed in the private sector too. “Instead, we need to address this by stepping up work on corporate social responsibility and increasing private participation in education.”

The FICCI Executive Council hinted it was keen to take part in various development programmes in the country as a part of corporate social responsibility. Projects of Dr Reddy’s Lab and Satyam Computer Services have been taken as ones that could be replicated in other parts of the country.

The State Chief Minister, Dr Y.S. Rajasekhara Reddy’s, suggestion about setting up rural public schools through public private participation (PPP) received encouraging response from the FICCI Executive Council, which agreed to partner in setting up five of them initially as a pilot project.

The FICCI Vice-President, Mr N. Srinivasan, commended the strides made by Andhra Pradesh in terms of attracting new investments. A big chunk of the growth in the State was driven by some of the projects of the Government.

Referring to the increasing consumption of cement in the State, Mr Srinivasan said that this reflected the buoyancy in the economy. In the last three years, no State in the country witnessed the kind of growth seen in Andhra Pradesh. The cement consumption in the State has tripled in the last three years. As against consumption of about 5 lakh tonnes per month, this has shot up to 16 lakh tonnes a month mainly due Government projects including housing for the poor.

Andhra Pradesh is the only State in the country that has initiated work on housing for the poor in such a large scale and this in turn has kicked up significant cement offtake, he said.

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