India Inc and some of the country’s top policy-makers were out in full strength on the opening day of the Davos summit to push the ‘India Inclusive’ agenda and answer questions about governance deficit that have been dominating headlines.
So, if Bharti Group Chairman Sunil Mittal was talking about “constructive criticism” of the government, Planning Commission Deputy Chairman Montek Singh Ahluwalia referred to the government’s focus on job creation and ICICI MD & CEO Chanda Kochhar reminded the audience about India’s demographic dividends.
The CEOs were obviously prepared for the tough questions they faced throughout the day. Asked whether India Inc is fed up with the way the government is functioning and whether he agrees with the criticism about governance deficit voiced by several of his colleagues in industry, Mittal said he agreed with some parts of the letter and that “even the Prime Minister should be happy” with the wise counsel of some of the leading lights in industry.
However, he said the media and global investors should not become too negative about these things as this is bound to happen in a vibrant democracy.
The awakening of entreprenurial spirit, he said, has made India a “continent of consumers” and it would be a mistake to ignore these positives and dwell too much on the negative energy. Praising political leaders such as Jairam Ramesh and Kapil Sibal, Mittal said the new telecom policy will be a “long runway” for the industry as it would ensure that there are no frequent shifts in the regulatory regime.
Asked by a senior executive of the Financial Services Authority in the UK about why India’s growth is still largely jobless, Ahluwalia said strict labour laws don’t allow large-scale employment in sectors that are labour-intensive. He advocated a trade off: Labour unions should allow more flexibility in exchange for stricter enforcement of labour rights and improving health standards. “Our labour unions could learn from China on labour law flexibility,” he said.
Amid the raging controversy over black money stashed abroad, Ahluwalia conceded that corruption is not only a social menace, it also affects the growth of the nation. “This is just not in India, but around the world. It is an issue which needs to be tackled, because corruption not only reduces the social acceptability of whatever growth we achieve, but actually reduces growth also,” he said, adding “we are quite clear that we have to tackle it. You need to design policies in such a way that the scope of corruption is reduced.”
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ICICI Bank’s Kochhar, who is here as one of the six co-chairs of the World Economic Forum meeting, said she was bullish on India’s growth as two things were going well for the economy. Demographic dividend was one, the other being the investments the country needed for manufacturing and infrastructure. “We do have certain kinds of challenges to manage, such as inflation and interest rates going up, liquidity and volatile capital flows. But, I think these are manageable,” she said.
Godrej Group Chairman Adi Godrej said it was unfortunate that everyone was only focusing on the negatives about India rather than the strong positives.