Upbeat over clear verdict.

Our Bureaus

Chennai/New Delhi, May 16 Before the elections, the Indian industry had prayed for only one kind of result – let any one party win big, let there not be a badly fractured verdict leading to Government that cannot move in any direction.

Now the industry is happy that its wish has been granted. With the Congress getting substantial number of seats and the UPA likely to form the government with the support of “like minded parties”, India Inc heaves a sigh of relief.

The President of the Confederation of Indian Industry, Mr Venu Srinivasan, told Business Line that he was happy that the India had “voted for stability”. Observing that this Government would be able to move forward with economic reforms, he said that the Indian industry would like the new government to address the issue of eliminating the fiscal deficit in quick time.

Reiterating the CII’s call for improving infrastructure, Mr Srinivasan said that the new government should give priority to the housing sector.

He said that the new government would have to look at developing Eastern India – the land that lies to the north of the Godavari river and covering the states of Orissa and Jharkhand.

“Our expectation from the new government would be that the economic imperatives are paid adequate attention to and the reform process is fast-tracked, because the current situation demands it. A key area of focus would have to be infrastructure, since it plays an important role in the economic revival and sustained growth of India,” he said.

Geopolitical alignment

Mr R. Seshasayee, former President, CII and Managing Director, Ashok Leyland, said that the new government would have to focus on the crucial issue of getting the right geopolitical alignment across the borders, to ensure that there is “no threat of regional hegemony from any Asian country.”

On the economic front, Mr Seshasayee observed that given the political mandate, there is confidence in the industry. The issue is to bring in capital. This the government should do by both encouraging savings as well as facilitating capital inflows from abroad.

Noting that there is no need anymore for direct stimulus, Mr Seshasayee said that the government should encourage investments into infrastructure, particularly through the public-private-partnership model. He said that the Congress always had the right ideological approach to PPP, but in the past was hampered by pressures from coalition partners.

100-day agenda

“The industry is happy that we have a verdict which is clear and not fractured. This will help the government take quick and decisive action. The Indian voter has given a clear verdict in favour of stability, continuity, growth and economic progress,” said Mr Harsh Pati Singhania, President, FICCI.

“With a clear mandate given by voters, India Inc now expects the new UPA Government to pull out all stops and unleash a slew of reforms in the area of pensions, insurance, banking, disinvestment, labour, private participation in defence and retail,” he added.

He said FICCI would present to the Government and the Prime Minister a 100-day agenda that focuses on economic recovery and a sustained growth of 9 per cent plus. Mr Sajjan Jindal, President, Assocham, hoped that the UPA Government will continue its progressive social and economic agenda for inclusive growth and good corporate governance.

The Chairman of the Shriram group, Mr R. Thyagarajan, said he enthusiastically welcomed the election results, which he said would result in the formation of “a stable, sensible government”. He said he expected the government to press ahead with liberalisation.

The Shriram group is a player in both life and non-life insurance and Mr Thyagarajan said he would like to see further liberalisation of the insurance sector.

Mr DE. Ramakrishnan, President, Industrial and Financial Reconstruction Association for Small and Tiny Enterprises (IFRASTE), also welcomes the election results, and hopes that “at least the new government will bring in measures to help the micro, small and medium enterprises”. He wants the government to implement the recommendations of the K C Chakrabarty Committee on MSMEs and also provide credit at concessional rates of interest to MSMEs.

Mr Rajiv Rai, Chairman, RKKR Steels, a company that is putting up an Rs 1,200-crore steel plant in Andhra Pradesh, is happy that there would be “continuity in policy”.According to Mr Satish Bagrodia, President, PHD Chamber, “The Chamber is hopeful that the new Government would usher in a new wave of reforms which would stimulate demand, provide a boost to the investment climate and put the economy on the path of growth at a time when the economy is buffeted by difficult economic conditions, both in the domestic and international marketplace.”

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(This article was published in the Business Line print edition dated May 17, 2009)
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