We will work with govt to increase investor confidence

Written by Kirtika Suneja | Updated: Apr 17 2013, 06:42am hrs
With general elections only a year away and the global economy yet to show signs of a turnaround, S Gopalakrishnan has taken charge as president of the Confederation of Indian Industry (CII) at a critical juncture when the Indian economy is facing pressure from a rising current account deficit and inflation. In an interview with Kirtika Suneja, he shares a three-pronged strategy that the industry chamber will follow to take forward the Centre's reforms process. Excerpts:

What is on your agenda on collaborating with the Centre to fasten the reforms process

We have certain priorities on how can we restart and accelerate large infrastructure projects by working with the Cabinet Committee on Investment (CCI), kickstart investment by implementing the Goods and Services Tax (GST) and Direct Tax Code (DTC) and third, a medium-term goal regarding the ease of doing business. To achieve these goals, we are in the process of setting up two task forces one to look at easing business in India and the other to coordinate with states on different reform measures.

What is the mandate of the two committees

We have proposed the two committees that will look at the ease of doing business in each state and the reforms required, respectively. Every state will share its best practices and others can learn why some states are growing faster and how can they improve their clearance processes. The second committee will coordinate the reforms process in each state.

How helpful are the macro-economic indicators in this recovery

The recent data on oil, inflation and gold prices is positive and we hope the central bank will reduce rates by another 100 basis points over the current fiscal. We are also beginning to reverse the negative spiral, which is linked with the widening current account deficit. The positive spiral, in turn, will lead to an increase in manufacturing.

Have you identified projects that need to be revived by the CCI

The CCI should aim for making a repository of at least top 50 stalled projects and go for their revival on a priority basis. We have identified 50 such projects that are stuck across sectors such as power and national highways of importance and have a huge impact on multiple sectors. The upcoming townships on the industrial corridor and the National Manufacturing and Investment Zone are some other important projects where land issues can crop up at local level. Besides, our members can invest in these zones.

Is India Inc also party to the policy paralysis by not following good corporate governance

Corporate governance is a part of the ease of doing business and we need a code of conduct to demonstrate that business is good for society. We will work with the government to simplify technology and laws to increase investor confidence - both overseas and domestic. There is a need for independent regulatory authorities in sectors of scarce resources such as coal, real estate and health.

How will setting up independent regulators help in combating corruption

When companies are not following good corporate governance, there is blame all around. 90-95% firms want to do business legally and ethically. Hence, we will partner with the government for reforms like direct cash transfer and e-governance to reduce corruption. However, there is always a small number of companies, which will take advantage of the system and we can't have a mechanism to investigate such matters because this is the government's role. Though we can't make it mandatory for our members to follow good practices, we can propagate and influence them to do so.

What is your agenda with general elections just a year away

For the 2014 elections, we do plan to create an agenda though we have not drafted it as yet. We will meet various parties and want their manifestos to include our agenda. Moreover, we want political leaders to interact with the business community.