Economy

Seven major consultancies join hands with Invest India for economic revival post Covid-19

M Ramesh Chennai | Updated on April 12, 2020

istock/Andrii Yalanskyi Andrii Yalanskyi

Group to chalk out strategy, action plan post Covid-19

Seven of the top global consultancy firms —– Bain & Co, EY, PwC, BCG, KPMG, Primus Partners and Mirae Asset Management — have joined hands with Invest India to chalk out an economic revival strategy for India after the pandemic comes to an end.

Invest India is a not-for-profit joint venture of Indian chambers of commerce (FICCI, CII and Nasscom holding 51 per cent) with the Ministry of Commerce (49 per cent), meant to catalyse investments into India.

The group that calls itself Business Reconstruction Team wants to “create a strategy and ‘ready to implement’ plan of action for India’s economic revival by analysing quantitative and qualitative metrics across States, districts and sectors,” according to documents of Invest India.

Two phases

Speaking to BusinessLine, Invest India’s Managing Director and CEO Deepak Bagla said the team intended to split its work into two phases. In the first phase, a strategy would be formulated for India to exit the lockdown by drawing upon the experiences of other countries. A sector-wise how-to-get-out strategy is in the works.

In the second phase, the team would develop an action plan for pulling investments into India. “India is already among the top FDI destinations in the world,” Bagla said, observing that FDI flows into India in the last five years accounted for half the total FDI received in the last 20 years.

According to government data, India received $64.37 billion of FDI in 2018-19, a 6 per cent jump over the previous year, which was the third year in a row when global FDI flows declined. According to the Global Investment Trend Monitor report compiled by UNCTAD, India was among the top 10 recipients of FDI in 2019, attracting $49 billion in inflows, a 16 per cent increase from the previous year.

But that was before the pandemic. Invest India, Bagla said, wants to make this “a watershed period” in India’s attracting of foreign investments.

Shift in supply chains

Many experts expect a shift in supply chains out of China, some of which could come to India. At a recent webinar on ‘Impact of Covid-19 on India Inc’, ICRA’s Vice-President and Sector Head – Corporate Ratings, Shamsher Dewan, said some manufacturers of auto components, pharmaceuticals, consumer durables and electronics and textiles could shift production to India. Dewan cautioned that these are too early days to detect a trend because supply chain shifting is typically a long-drawn process, but said there were some “initial signs” of companies asking their suppliers to set up manufacturing facilities outside China too.

Japan recently announced the setting up of a $2.2-billion fund to help its manufacturers shift production out of China as the coronavirus disrupts supply chains between the major trading partners.

In this context, the Business Reconstruction Team wants to evolve a “9-point workstream plan for the Phase-I economic revival of India’s industry.”

Published on April 11, 2020

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