Economy

‘We’ll enable more Indian firms to grow globally’

KR Srivats Debabrata Das New Delhi | Updated on January 20, 2018

NAUSHAD FORBES CII President

New CII President bats for more outward looking trade and investment policies





Global interest in India and keenness to do more here has never been higher and “we should all work together to try and tap it”, says the new Confederation of Indian Industry (CII) President, Naushad Forbes. At the same time, there is a need for Indian trade and investment policies to turn “more outward looking,” according to Forbes, who is Co-Chairman of Forbes Marshall, a manufacturer of steam engineering and control instrumentation products. From CII’s side, the efforts during Forbes’ Presidency would be on bringing the ‘connect’ to enable more Indian firms piggyback on the already successful ones in the global markets. Excerpts:

What do you think the Government can do to further encourage Indian industry and boost manufacturing?

We need to try and see how to grow the number of home-grown multinationals. I think we have to see how to grow 100s or 1000s of such home-grown multinationals. There are many successful Indian firms that have proprietary technology, excellent management in many different fields including textiles and garments. We have to see how to grow them as much as possible. It has policy requirements and firm management requirements.

The policy requirements are how to change our trade policy stance from being defensive, from blocking the access of foreign firms in India into a more outward looking stance where we try to enter and access more and more foreign market of interest to Indian firms. There are hundreds of Indian medium-sized firms with factories in Thailand, Indonesia, Egypt and Ethiopia. That is what we need to enable.

What is your view on the government’s dealing with the trade policy?

I don’t think the Indian government has been protectionist. I think more and more people in the government are looking outwards and have ambitions for Indian firms. From our side, we have to enable this to happen. We have to use the firms successful in global markets and how to have Indian firms piggyback on them to grow. From CII, that is the connect we would be doing to enable more firms to grow in global markets.

How can domestic manufacturing be improved? What more can be done here?

To improve manufacturing, there are many good things that we can do. I would take three major things that we can do.

First, attract manufacturing and this is exactly what the Make in India campaign is about — how to attract the leading companies. We have done several visits abroad focussed on attracting manufacturing investment in India.

The visits have very productive and very good and the numbers have started to show up in the FDI data which are growing strongly.

Secondly, certain sectors need to grow much faster in the economy than they have been. So take textiles and garments. Lots of potential for it grow than it has been. Major opportunity for Make in India as textile moves out of China. To do that, we need to do things on labour reforms, logistics and infrastructure. There is a major opportunity in sectors like this. One of the areas being talked of is our integration with the global supply chain.

We are very good in IT, quite good in automotive components, we are somewhat active in pharmaceuticals and specialty chemicals, we are much less active in textiles and garments and we are almost missing in electronic hardware.

In the case of textiles and garments, we have lost the competitiveness. Electronics and hardware we never had. That’s where the move to attract people like Foxconn helps.

Will structural reforms (on the labour front) help get back the competitiveness for the Indian textiles industry?

I think, without a doubt, it will. Textiles and garments is a sector that will benefit most directly from labour reforms. I am not talking about labour reforms that will enable lower wages to be paid. That is not the reform we are talking about.

We are talking of labour reforms that simply enable much greater flexibility of hiring and reducing. So, if you need seasonal employment and you have laws that you can only hire people, then, you simply won’t hire people. Labour reforms are not about exits and reduction. It is as much about hiring and flexibility. I think increasingly that is being recognised.

Is the Modi-led government walking the talk on labour reforms?

Labour reforms were first talked about in 1992 by Manmohan Singh as Finance Minister. He got attacked on all sides, including his own party. The issue was dropped and vanished for over 20 years from the legislative agenda. This government started talking about it again and they talk about it now in a very productive way. They have said it is a concurrent subject so let the States go ahead and make the changes in their legislation and we will approve what they change.

We have seen the results, Rajasthan has done it, Andhra Pradesh, Madhya Pradesh, Tamil Nadu and no one would have expected but West Bengal has done it.

Significant changes made and approved by the Centre.Now, Maharashtra is talking about it, Telangana is talking about it.

Published on April 11, 2016

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

This article is closed for comments.
Please Email the Editor