Be Bold, India Inc Urges Vajpayee

New Delhi, November 24: | Updated: Nov 25 2002, 05:30am hrs
Absence of political dignitaries and thin attendance did not mar the quality of deliberations at the opening session of the India Economic Summit 2002 which began here on Sunday. The co-chairs, including Infosys chairman NR Narayana Murthy and unstoppable chief of Bajaj Auto Rahul Bajaj vehemently urged Prime Minister Atal Bihari Vajpayee to be courageous.

This Way Please: Infosys chairman NR Narayana Murthy with Lord Charles Powell (left) and Bajaj Auto chief Rahul Bajaj at the Plenary Session of India Economic Summit in New Delhi on Sunday
The choice before India, said Charles Powell, another co-chair of the summit and chairman of Sagitta Assets Management of Britain, was to, either go ahead with the business as usual scenario and achieve 3-4 per cent growth rate or get going by pushing divestment, lowering tax rates, relaxing labour laws, allowing 100 per cent FDI in all sector and endeavour to attain sustained 8 per cent growth rate.

These suggestions were thrown up during the panel discussion moderated by World Economic Forum (WEF) president Claus Schwab. The other co-chairs who included president and chief executive of Moodys Corporation John Rutherfurd Jr, Trigem Computer chairman YT Lee and Confederation of Indian Industry president Ashok Soota urged the same point that to achieve 8 per cent GDP growth rate India would need to reform - at a faster rate than others.

Apart from participants, the speakers too felt the absence of Mr Vajpayee and finance minister Jaswant Singh. To make the exercise meaningful Mr Schwab repeatedly said the forum would forward the suggestions of the conference to Mr Vajpayee and Mr Singh for appropriate action.

Setting the tone of the opening session, WEF director Colette Mathur said participation at the summit was better than last year and representatives from 25 countries were attending it. Although she may be true, few believed her as most of those listed in the participants list were not seen at the meeting.

The other marked difference was that Ms Mathur was extremely polite in her reference of India, which was difficult to swallow. With fiscal deficit piercing the roof and divestment hitting a road block, not everyone believed, as asserted by Ms Mathur that all fundamentals are good.

However, Mr Murthy was quite candid when he urged Mr Vajpayee, to be courageous, be firm and take decisions as if there is going to be no tomorrow. Stating that 8 per cent growth is a plausible impossibility, he stressed, the Prime Minister should put in place ministers and bureaucrats who are modern and believe in globalisation and give them unfettered freedom to function.

Mr Rutherfurd, who reiterated that Moodys was going to shortly review Indias forex rating for a possible upgrade, suggested the government try to encourage FDI and allocate and re-allocate public funds where they can be used more profitably. The upgrade would not have much impact as the government has no forex debts or euro bonds, he said, adding the bigger challenge was to contain the growing fiscal deficit.

When Mr Bajajs turn came, he said, experts, especially the pink media dismissed us as old company. But we have survived the competition and opening of economy. Old dogs can also learn new tricks. The biggest challenge before India, he said, was to covert thousands of old companies into globally competitive corporates. What we want is less corruption. The developed world is not moving slowly. We have to make environment conducive for growth otherwise the distance between the developed world and India will increase further.

Mr Bajaj, however, struck a provocative note when he said, who is afraid of globalisation The developed world or the developing countries He said this in context of denial of market access to the developing world by the developed world in the name of non-tariff barriers.

As expected, it evoked a response from Mr Powell, who said agriculture subsidy is a scandal in Europe. While poor people in the Third World are living on a income of less than a dollar a day, every cow in Europe gets two dollars a day.

For CII director-general Tarun Das commented, what a good way to start a summit! sans political masters. His only regret was why we never thought of it before. CII has been organising these meetings with the WEF for the past 18 years.