 "Pushing policy reforms, the ease of doing business are our focus: S Gopalakrishnan")
The Confederation of Indian Industry (CII) has chosen Infosys Technologies’ co-chairman, S Gopalakrishnan to head it in 2013-14, at a time when both economic growth and the confidence of India Inc needs to boost. He talks to Shine Jacob & Indivjal Dhasmana on what he hopes to achieve. Edited excerpts:
You come from the services sector and the government is pinning hopes on the manufacturing sector for creating jobs. Which sector will CII focus under your leadership?
Raising the share of manufacturing from about 17 per cent to 25 per cent of GDP is necessary. This will spur job creation not only in the sector but also around the sector. For example, when manufacturing in agriculture increases, there are jobs created in transportation, supplies and related sectors. If economic activity increases, the entire supply chain up to retail will benefit and grow. It is all linked.
By looking at entrepreneurship, innovation, etc, we will also create new companies across all sectors. When income increases in rural areas, the need for improvement in healthcare and other services will naturally happen. That’s the linkage.
You are taking over the reigns of CII at a time when the confidence of India Inc has dipped. What is your agenda to increase it?
It will only happen through the working together of the industry, the government and the society. There has to be an agenda for all of us to improve this. The role of government should be to continue with the reform process, continue to address the issue of retrospective amendments, increase the investor confidence, address the issue of fiscal deficit, address the current account deficit.
The part that industry has to do is about creating jobs, increasing investments, economic activities, etc. There is a role for some of the regulators. If inflation is coming down, then look at interest rates, so that consumer confidence can be increased. So there is a role for every part of this value chain, to increase confidence
You talked about cutting interest rates but retail inflation is still in double digits.
If core inflation is coming down, banks might look at another cut in interest rates. CII has been advocating a 100-basis points cut in interest rates over the next few months. We should look at retail inflation. It’s a supply issue, rather than anything else. We need to look at economic activity to address that. So, we need to look at reforms.
Corruption charges fly thick and fast against the government and India Inc, with civil society emerging as a big force. How would you build the trust of the common man in India Inc?
That is why our focus is on the ease of doing business, which will reduce the opportunity for corruption or the need for that. Reforms, use of e-governance, use of technology in government processes so that citizens are engaged online, rather than in person. We need to work within our own members to look at a code of conduct. We need to look at how we can put in those practices within our companies. We ,ave also advocated electoral reforms; how elections need to be funded. We have submitted a paper in this regard, so that funding is addressed and the corruption comes down.
With the sunset clause on the Software Technology Parks of India (STPI) scheme coming soon, what will be the future of the IT (information technology) industry in India?
The government has announced an SEZ (Special Economic Zones) policy which helps not just the IT industry but any company that wants to do business. We have been demanding specific incentives for start-ups. We are broadening the concept of start-ups to cover not only IT but across sectors.
This being an election year, how will you at CII lobby for the GST (goods & services tax), DTC (direct taxes code)?
We have been meeting chief ministers of various states. We are understanding from them what their issues are. We are trying to create a middle ground in promoting the implementation of GST and will continue to do that.
This being an election year, we have to present our requirements.
Besides DTC and GST, which reforms are you are looking forward to?
The whole area of land acquisitions, infrastructural projects, environmental clearances. We should make sure that implementation of reforms don’t get held up. We should focus on the ease of doing business.
You come from the services sector and the government is pinning hopes on the manufacturing sector for creating jobs. Which sector will CII focus under your leadership?
Raising the share of manufacturing from about 17 per cent to 25 per cent of GDP is necessary. This will spur job creation not only in the sector but also around the sector. For example, when manufacturing in agriculture increases, there are jobs created in transportation, supplies and related sectors. If economic activity increases, the entire supply chain up to retail will benefit and grow. It is all linked.
By looking at entrepreneurship, innovation, etc, we will also create new companies across all sectors. When income increases in rural areas, the need for improvement in healthcare and other services will naturally happen. That’s the linkage.
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You are taking over the reigns of CII at a time when the confidence of India Inc has dipped. What is your agenda to increase it?
It will only happen through the working together of the industry, the government and the society. There has to be an agenda for all of us to improve this. The role of government should be to continue with the reform process, continue to address the issue of retrospective amendments, increase the investor confidence, address the issue of fiscal deficit, address the current account deficit.
The part that industry has to do is about creating jobs, increasing investments, economic activities, etc. There is a role for some of the regulators. If inflation is coming down, then look at interest rates, so that consumer confidence can be increased. So there is a role for every part of this value chain, to increase confidence
You talked about cutting interest rates but retail inflation is still in double digits.
If core inflation is coming down, banks might look at another cut in interest rates. CII has been advocating a 100-basis points cut in interest rates over the next few months. We should look at retail inflation. It’s a supply issue, rather than anything else. We need to look at economic activity to address that. So, we need to look at reforms.
Corruption charges fly thick and fast against the government and India Inc, with civil society emerging as a big force. How would you build the trust of the common man in India Inc?
That is why our focus is on the ease of doing business, which will reduce the opportunity for corruption or the need for that. Reforms, use of e-governance, use of technology in government processes so that citizens are engaged online, rather than in person. We need to work within our own members to look at a code of conduct. We need to look at how we can put in those practices within our companies. We ,ave also advocated electoral reforms; how elections need to be funded. We have submitted a paper in this regard, so that funding is addressed and the corruption comes down.
With the sunset clause on the Software Technology Parks of India (STPI) scheme coming soon, what will be the future of the IT (information technology) industry in India?
The government has announced an SEZ (Special Economic Zones) policy which helps not just the IT industry but any company that wants to do business. We have been demanding specific incentives for start-ups. We are broadening the concept of start-ups to cover not only IT but across sectors.
This being an election year, how will you at CII lobby for the GST (goods & services tax), DTC (direct taxes code)?
We have been meeting chief ministers of various states. We are understanding from them what their issues are. We are trying to create a middle ground in promoting the implementation of GST and will continue to do that.
This being an election year, we have to present our requirements.
Besides DTC and GST, which reforms are you are looking forward to?
The whole area of land acquisitions, infrastructural projects, environmental clearances. We should make sure that implementation of reforms don’t get held up. We should focus on the ease of doing business.