India’s current position is of strength and the coming 25 years or the Amrit Kaal has a lot to offer to industry and people, said Finance Minister Nirmala Sitharaman at the 95th Annual Convention and AGM of FICCI. The FM, in her address, cited World Economic Forum data of 140 million middle-income households to be added to India’s economy by 2030 as a sign of India’s strength going forward. WEF also projects 14 million high net individuals (HNI) households to be added by 2030. FM emphasised that a major reset in happening globally amid challenges due to war in one area, and after-effects of the pandemic in other. There are several other uncertainties as well which are constraining our supply chains, she said. However, the WEF projections tell where the market potential lies.
Recession in the West an opportunity for India
India should be focusing on manufacturing and newer areas of the services sector. Sitharaman asked the Indian industry to work out strategies as to how businesses operating in developed countries can look at India as a production or sourcing hub amid recession fears in the western countries. “India has brought in a lot of facilitation and tweaking of rules to attract foreign investment into India and is also engaging with industries who want to co-locate in the country,” she said. “Even as they are headquartered there, it might be useful for them to think of sourcing many things from here and producing from here at least for markets in this part of the globe,” Sitharaman said.
The suspected long-drawn recession, which is likely to affect Europe, is not just going to affect exports by Indian businesses, but it gives an opportunity for many of the investments which are there, which are now looking for a different place from where activities can continue to happen, she noted. “As the world transitions into clean energy, the domestic industry could face higher tariffs by the developed countries,” Sithraman said.
Keep close watch on innovations
She also asked India Inc to tell the government how climate change is affecting them and suggest ways to reduce the burden of cost falling on them. “I would seek the industry to keep a close watch on the innovations coming out of the startups, and the energy and enthusiasm with which they are moving ahead. I want the industry to be fully seized of the increased costs they will face in the transition to cleaner energy,” FM said.
Next Budget to follow spirit of Budget 2022
Sitharaman said that the next Budget will follow the spirit of the previous budget. “We will scale it up and take it for the next 25 years.” Echoing FM’s sentiment on India’s strength, Subhrakant Panda, President-Elect, FICCI & MD said, “India is better prepared than it has ever been to deal with short-term turbulence without losing sight of the huge opportunity that is there.” Indian industry has great expectations that the Union Budget 2023 will be growth-oriented and build further on the foundation of the government’s initiatives over the last eight years, he added.