Stable government key to achieving 'Viksit Bharat': FICCI President Anish Shah
Addressing the priorities for the new government, Shah advocated for a focus on reducing the cost and improving the ease of doing business in India, alongside establishing high-quality manufacturing standards. According to Shah, these elements are crucial for India to excel globally in manufacturing.
Anish Shah, President of FICCI and Group CEO and MD of Mahindra Group, believes that a stable government will help India achieve its goal of Viksit Bharat.
Addressing the new government's priorities, Shah advocated for a focus on reducing costs, improving the ease of doing business in India, and establishing high-quality manufacturing standards. According to Shah, these elements are crucial for India to excel globally in manufacturing.
Shah also touched upon the state of the rural economy, noting the recent years' mixed performance due to varying rainfall patterns. While acknowledging some rural distress, he remained optimistic about the future, citing early positive signs such as increased tractor sales. He suggested that while some policy interventions might be necessary, they need not be drastic.
Looking ahead to the full budget, Shah advocated for a continued focus on growth and investment, particularly enhancing farm prosperity, streamlining the farm-to-fork process, promoting women-led development, and investing in sustainable, green solutions. These priorities, he believes, are critical for driving India's comprehensive and inclusive growth.
Edited excerpts from the interview.
Q: We are still waiting for the announcements regarding the portfolio allocation to come in. The first cabinet meeting of the government is going to start very shortly. But overall, on the back of what we saw yesterday with 72 ministers being sworn in, it seems like there is more continuity than change, at least if you look at the cast of characters. We don't know whether responsibilities will change—your first reaction on the Council of Ministers.
Shah: There is continuity in change. With the new government coming in, it is good to see many of the ministers there being sworn in again. It remains to be seen whether many of them will keep the same portfolios or not. I had a chance to interact with some of them yesterday, and it was good to see everyone who was very upbeat. It was an amazing ceremony. I think we are headed on the right path. We have seen a lot of progress over the last few years, and a stable government will only help India reach its Viksit Bharat goal.
Q: Let us talk about prioritisation as far as the government is concerned. The process of consultation for the full budget is already underway, and a lot of the recommendations and the feedback that have come in for instance, suggest that there needs to be a review of the PLI schemes. Many of the PLI schemes are also getting closer to their fifth year, so a review is likely. Perhaps the government may want to consider PLI schemes that encourage or incentivise more participation in the MSME sector. How would you read about the possible changes or tweaks to existing schemes like the PLI scheme?
Shah: In discussions that FICCI has had with the government, they are looking for transformative growth over the next few years. Whether the election result and the coalition government change the transformation agenda is too early to say, but that seems to be the plan. In particular, PLI schemes were meant for specific stimuli, and I would say that we should always be hesitant to ask for a stimulus. The question is, what is good for the economy in the long term? And as we think about that, manufacturing has to be a mainstay for us. We have to be able to make India for the world. That means we need a lower cost, greater ease of doing business, and a quality standard that will make India among the best in the world and known for the highest quality goods. These are the kinds of things the government should drive going forward with a series of initiatives, and these are some of the discussions we are having with the government at FICCI.
Q: One of the conversations that has picked up steam post-election verdict is whether we will see a change in approach as far as policymaking goes, specifically to address the rural economy. Some read the mandate as a mandate of rural distress, which is reflected in how Bharat has voted. Do you anticipate or believe there is a need to change policy to address the rural economy?
Shah: If we look back over a slightly longer period, rural India has done very well for a couple of years, and yes, there has been some distress for a couple of years after that. I'm not sure whether it requires a significant policy change. The distribution of rainfall last year played some role in that as well. This year promises to have much better rainfall. We'll see if that works out. And if it does, rural India should be in much better shape. We see some green shoots from a Mahindra standpoint as we look at tractor sales. And therefore, I would not paint it as a picture of doom and gloom in rural India. There has been some distress, but there are some green shoots now. And overall, I'm optimistic that things should move forward well. It may need some interventions, but not some dramatic ones.
Q: We saw the interim budget and now the government has the opportunity to present the full budget, which we expect will perhaps be on the 8th of July, is what we're given to understand. Of course, we are still awaiting official confirmation. What would the expectation be, taking forward where the interim budget left things? What would the expectation be for the full budget this time?
Shah: The past two budgets have been growth-focused, focused on investments. It focused a lot less on incentives and SOPs, and that is what we'd like it to be and continue on that path. Hopefully, it will accelerate that path. The full budget should focus on manufacturing to lower the cost of business, improve the ease of business, and focus on more aspects of farm prosperity. This is where we come back to rural. I think a transformative change is required in terms of how we have the entire process from farm to fork streamlined, how we have cold chain storage as part of it, and how we reduce the wastage we see in food. I think that is a transformation waiting to happen. Women-led development is one area that is very important for us as a country, and the fourth area I would look at is sustainability and how we lead the world in terms of creating green solutions and investing in them.
Addressing the new government's priorities, Shah advocated for a focus on reducing costs, improving the ease of doing business in India, and establishing high-quality manufacturing standards. According to Shah, these elements are crucial for India to excel globally in manufacturing.
Shah also touched upon the state of the rural economy, noting the recent years' mixed performance due to varying rainfall patterns. While acknowledging some rural distress, he remained optimistic about the future, citing early positive signs such as increased tractor sales. He suggested that while some policy interventions might be necessary, they need not be drastic.
Looking ahead to the full budget, Shah advocated for a continued focus on growth and investment, particularly enhancing farm prosperity, streamlining the farm-to-fork process, promoting women-led development, and investing in sustainable, green solutions. These priorities, he believes, are critical for driving India's comprehensive and inclusive growth.
Edited excerpts from the interview.
Q: We are still waiting for the announcements regarding the portfolio allocation to come in. The first cabinet meeting of the government is going to start very shortly. But overall, on the back of what we saw yesterday with 72 ministers being sworn in, it seems like there is more continuity than change, at least if you look at the cast of characters. We don't know whether responsibilities will change—your first reaction on the Council of Ministers.
Shah: There is continuity in change. With the new government coming in, it is good to see many of the ministers there being sworn in again. It remains to be seen whether many of them will keep the same portfolios or not. I had a chance to interact with some of them yesterday, and it was good to see everyone who was very upbeat. It was an amazing ceremony. I think we are headed on the right path. We have seen a lot of progress over the last few years, and a stable government will only help India reach its Viksit Bharat goal.
Q: Let us talk about prioritisation as far as the government is concerned. The process of consultation for the full budget is already underway, and a lot of the recommendations and the feedback that have come in for instance, suggest that there needs to be a review of the PLI schemes. Many of the PLI schemes are also getting closer to their fifth year, so a review is likely. Perhaps the government may want to consider PLI schemes that encourage or incentivise more participation in the MSME sector. How would you read about the possible changes or tweaks to existing schemes like the PLI scheme?
Shah: In discussions that FICCI has had with the government, they are looking for transformative growth over the next few years. Whether the election result and the coalition government change the transformation agenda is too early to say, but that seems to be the plan. In particular, PLI schemes were meant for specific stimuli, and I would say that we should always be hesitant to ask for a stimulus. The question is, what is good for the economy in the long term? And as we think about that, manufacturing has to be a mainstay for us. We have to be able to make India for the world. That means we need a lower cost, greater ease of doing business, and a quality standard that will make India among the best in the world and known for the highest quality goods. These are the kinds of things the government should drive going forward with a series of initiatives, and these are some of the discussions we are having with the government at FICCI.
Q: One of the conversations that has picked up steam post-election verdict is whether we will see a change in approach as far as policymaking goes, specifically to address the rural economy. Some read the mandate as a mandate of rural distress, which is reflected in how Bharat has voted. Do you anticipate or believe there is a need to change policy to address the rural economy?
Shah: If we look back over a slightly longer period, rural India has done very well for a couple of years, and yes, there has been some distress for a couple of years after that. I'm not sure whether it requires a significant policy change. The distribution of rainfall last year played some role in that as well. This year promises to have much better rainfall. We'll see if that works out. And if it does, rural India should be in much better shape. We see some green shoots from a Mahindra standpoint as we look at tractor sales. And therefore, I would not paint it as a picture of doom and gloom in rural India. There has been some distress, but there are some green shoots now. And overall, I'm optimistic that things should move forward well. It may need some interventions, but not some dramatic ones.
Q: We saw the interim budget and now the government has the opportunity to present the full budget, which we expect will perhaps be on the 8th of July, is what we're given to understand. Of course, we are still awaiting official confirmation. What would the expectation be, taking forward where the interim budget left things? What would the expectation be for the full budget this time?
Shah: The past two budgets have been growth-focused, focused on investments. It focused a lot less on incentives and SOPs, and that is what we'd like it to be and continue on that path. Hopefully, it will accelerate that path. The full budget should focus on manufacturing to lower the cost of business, improve the ease of business, and focus on more aspects of farm prosperity. This is where we come back to rural. I think a transformative change is required in terms of how we have the entire process from farm to fork streamlined, how we have cold chain storage as part of it, and how we reduce the wastage we see in food. I think that is a transformation waiting to happen. Women-led development is one area that is very important for us as a country, and the fourth area I would look at is sustainability and how we lead the world in terms of creating green solutions and investing in them.
(Edited by : Swapnil Deshpande)
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