Growth agenda on track, says India Inc

MUMBAI: BJP’s massive defeat in Delhi, just two weeks before the Union Budget, is unlikely to impact the government’s plans of charting out a plan to boost economic growth. Although stunned by the extent of AAP’s victory in the capital, which diminished the BJP and entirely eliminated the Congress, industry leaders expressed conviction that it would not impact the reforms process going forward.
“I don’t see any slowdown in reforms. In fact, BJP has to accelerate the reforms process for them to show development,” said Motilal Oswal, chairman, Motilal Oswal Financial Services.
Commenting on the change for which the people of Delhi voted, Deepak Parekh, chairman, HDFC, wondered how Kejriwal will deliver on its promises on cheaper power and access to water. “I don’t think the government is going to give more goodies in the Budget as fiscal deficit is very high. How can they give more concessions?” said Parekh.
Markets had tanked on Monday after AAP’s prospects of forming the government in Delhi looked bright, leading to speculation whether a party known for its populist measures could derail the country’s larger economic growth agenda. Allaying such fears, Anand Mahindra, CMD, Mahindra Group, tweeted: “A strong local government promising clean governance bodes well for ease of doing business in the territory. So the market seems to have recovered its composure and its recognition of the value of the democratic process.”
While Harsh Mariwala, chairman, Marico, hoped the new CM concentrates his energy in improving Delhi in the near future, Kishore Biyani, founder & CEO, Future Group, was quite categorical. “I don’t think there will be any impact on business or the Budget. That’s more or less settled,” Biyani said.
Harsh Goenka, chairman, RPG Enterprises, expects this Budget to be “game-changing”, directing the industry towards “achhe din”.
Some CEOs believe AAP’s victory to be a wake-up call for BJP. “However, I don’t believe this will set back the reform agenda. Prime Minister Modi is driven by a gruff sense of purpose and certainly would like to leave an economic reforms legacy behind,” said Ranjit Shahani, VC and MD, Novartis India.
AAP’s pro-trade posturing has some CEOs viewing its comeback as positive. “AAP is industry- and trade-friendly. Their manifesto focuses on employment creation and clean governance, which is good for the industry,” said V N Dhoot, chairman, Videocon Industries, who believes Delhi is too small a state to have any bearing impact upon the Union Budget.
Rashesh Shah, chairman, Edelweiss Group, agrees. “It is unlikely to distract Narendra Modi from his stated plan of economic growth and governance,” he said.
Nirmal Jain, chairman, IndiaInfoline group, said, “Often, a sense of complacency goes against the sense of accountability. I think this (the AAP win) will make BJP more committed to the development agenda on which it came to power at the Centre in May 2014.” As for AAP, Sunil Godhwani, CMD, Religare Enterprises, said it should focus on delivering on the local issues that they have consistently promised to the people and what really has been the cornerstone of their political discourse.