Captains of Indian industry faced with a severe economic slowdown, today urged the government to take immediate measures to arrest the ongoing slump through policies focussed on the rural market, while reminding the Prime Minister that majority of their recommendations made through the several task forces were yet to be implemented.
The industrialists, emerging from an important meeting of the Prime Minister's Advisory Council on Trade and Industry, however, expressed hope that "Prime Minister Atal Bihari Vajpayee who had a strong desire to move ahead with the agenda of economic reforms" will take positive steps within weeks in the areas of capital market reforms, infrastructure development and and disinvestment of public sector undertakings, helping in a fast revival of the economy. "Expect a lot of action in the next few weeks," Sanjiv Goenka, vice-chairman of the RPG group and president of the Confederation of Indian Industry (CII) said. "Among the first things we expect is a drop in interest rate since both the finance minister and the Reserve Bank of India said they will seriously consider the issue."
President of the Federation of Indian Chambers of Commerce and Industry (Ficci), Chirayu Amin, said: "Speed (of implementaion) was an important issue in the meeting. Since the government today showed a keenness to get out of the present mess, we expect some positive signals soon."
More From This Section
A strong plea was made to implement the recommendations of the various task forces set up by the Prime Minister and headed by industry representatives. The advisory council will meet again in December to take stock of the progress made in the next three months, he added.
Mukesh Ambani, vice-chairman and managing director of Reliance Industries Ltd made a strong case for stock market reforms and rural development. "Both government and industry recognise the crisis of productive expenditure. The issue is to reach rural and semi-urban India," he said. Around 70 per cent of India live in villages and the fruits of development in rural India will have a positive impact on the country's economy.
The meeting with the Prime Minister could not have come at a more opportune time, as industry is reeling under a demand slump and is bogged down by recent stock market upheaval, US-64 crisis and the impact of the United States' slowdown. "Today's meeting will go a long way in the revival of the Indian economy," said President of Assocham, Raghu Mody.
As Amin said: "Sudden discontinuation of badla, lack of vigilance in the stock market, slowdown in public investment in infrastructure projects and the slow pace of disinvestment are adversely affecting the Indian economy. We need to act now."
Ficci, on its part, presented an eight-point revival package for the economy which includes revitalisation of capital market, major disinvestment drive, providing a fillip to the housing and construction sector, exchange rate correction and systematic reduction of cost of borrowing. CII made a presentation on infrastructure development and implementation, disinvestment and stock market revival.