Make in India Week another marker in India′s transition

Make in India Week another marker in India′s transition

It is a fact that the previous Indian government had left the country's economy in a bad shape - rising unemployment, widening fiscal deficit, high inflation, and persistently high interest rates with no pressure to lower them.

The image of the country was battered at every twist and turn by a series of corruption scandals. I was therefore disappointed when in July 2014 finance minister Arun Jaitley delivered his first Budget (albeit an interim one), not much was made out of how bad the previous lot had left things. It was playing to a political open goal; had he chosen to do so

But later I was told that the new government had concerns that though they would have been entirely justified at heaping insults at the previous Congress regime, it would have dented the fragile confidence the Modi victory brought among foreign investors and markets. Bad politics, but good economic sense, and therefore good long-term politics.

PM Modi had little choice but be proactive in restoring confidence in India. His sustained campaign of economic diplomacy paid dividends. Foreign direct investment (FDI) flows have grown by over 48 per cent and investors have bought into the vision of a more economically federal India, much like the US. The government's decisions on FDI, project financing, centre-state relationships as well as the unveiling of ambitious and innovative programmes, such as Make in India and Digital India among others, have reinforced that confidence. Relieving start-ups of any compliance for the first three years of their existence removes a major barrier for new companies as they strive to get a foothold. Could this be a precursor to further easing of barriers to set up and do business in other areas

The global investor community has noticed these changes. In fact from tottering on the verge of being described as a “banana republic” for its retro-active tax imposition, India is now recognised globally as one of the very best, if not the best place for investors seeking good ROI.

The first-ever “Make In India Week” is one such major step. Focusing on innovation in manufacturing for the next decade in India, it would showcase 17 states competing to attract investment while highlighting India's design prowess as the country seeks to move up the value chain. States are confident of attracting billions of dollars in investment from delegates across 60 countries and 8,000 domestic industry leaders.

These are worthy achievements and important markers in India's transformation, yet these are just about setting the stage. Indians in general haven't yet felt the positive difference in their lives. So, unsurprisingly, the government is not getting much credit from the electorate on its achievements. PM Modi and his team have around two years to ensure these initiatives deliver jobs and growth before the campaign for the 2019 General Elections begins.

There is the sense of déjà vu of the ill-fated NDA campaign of “India Shining”, which makes this year's Budget politically the most significant one. Walking a tight-rope, Arun Jaitley would have to ensure the Budget is geared towards implementation that deliver real dividends.

This year the 'India Investment Journal' will track how well India implements, focusing on where and how to tap opportunities alongside in-depth analysis and insight for foreign investors. In effect, 'IIJ' is an enabler for foreign investors to do business in India.

ManojManoj Ladwa is the Founder and Chairman of India Inc. Group.

Related Stories

No stories found.

Podcast

No stories found.

Defence bulletin

No stories found.

The power of the quad

No stories found.

Videos

No stories found.

Women Leaders

No stories found.
India Global Business
www.indiaglobalbusiness.com