ET NowIn a chat with ET Now SK Munjal, Joint MD of Hero MotoCorp, said that there are early signs of revival in the economy and good monsoon will improve the demand for two-wheelers.
ET Now: There is a drought situation in many parts of the country at the same time met department has also forecasted better than normal monsoon. How do you see the economy performing in the next few months?
SK Munjal: The world economy has seen a very challenging time in the last few years. India has also suffered along with everybody else. It is a fact we have been better than many others, but for our own needs, it is not enough. We need to grow faster. We have not been investing enough in creating new capacities because of lack of demand. You can see the early signs of revival right now. It is patchy, but it is there in different geographies and different sectors of industry of India. You can see some recovery taking place and at the same time the government has started spending in large infrastructure projects.
With the investments coming in the large projects, the recovery has now begun and as the wages go up we expect liquidity in the system to improve. With that coming in, I would say private sector would also start investing in new capacity thereby creating more jobs, prosperity and a virtuous cycle. The forecast for normal or a better than monsoon is very welcome as we had two years of drought. As an economy, we are still very dependent on agriculture as a trigger for the annual economic cycle.
The demand in the rural areas particularly has suffered and many of the consumer businesses which have a rural facing business have also suffered. The monsoon forecast from met department and experts is a welcome news. We hope that will start India’s cycle of recovery and the FM, in fact, has already said yesterday that with better than normal monsoon expectation, growth could go up to as much as 8.5% of GDP.
ET Now: Do you think good monsoon is going to impact in very positive way for you as well as the overall two-wheeler sector is concerned?
SK Munjal: Overall, manufacturing and services businesses will see a revival in demand and certainly the two-wheeler business. Early signs are there in some parts of the country and besides two wheelers, you can see it in commercial vehicles, cars and some parts of the consumer goods. All of them are starting to show signs of recovery. So, I think this is a good sign and I hope the recovery continues and also picks up quicker.
ET Now: How do you read into the Governor Rajan’s remarks that India should not get carried away by the growth superiority?
SK Munjal: I think what he is trying to tell us is be careful, do not get carried away with this positive sentiment alone. There is work to be done. So we have to keep our heads down. Focus on making sure we are doing the right things. Sometimes what happens is when you pat yourself too much on the back, you forget to do more things. So I think it is a good balance to strike. We need to compliment ourselves on some of the things that have been done, but at the same time we should not take our eye off the ball. There is much more work to be done.
ET Now: There is a drought situation in many parts of the country at the same time met department has also forecasted better than normal monsoon. How do you see the economy performing in the next few months?
SK Munjal: The world economy has seen a very challenging time in the last few years. India has also suffered along with everybody else. It is a fact we have been better than many others, but for our own needs, it is not enough. We need to grow faster. We have not been investing enough in creating new capacities because of lack of demand. You can see the early signs of revival right now. It is patchy, but it is there in different geographies and different sectors of industry of India. You can see some recovery taking place and at the same time the government has started spending in large infrastructure projects.
With the investments coming in the large projects, the recovery has now begun and as the wages go up we expect liquidity in the system to improve. With that coming in, I would say private sector would also start investing in new capacity thereby creating more jobs, prosperity and a virtuous cycle. The forecast for normal or a better than monsoon is very welcome as we had two years of drought. As an economy, we are still very dependent on agriculture as a trigger for the annual economic cycle.
The demand in the rural areas particularly has suffered and many of the consumer businesses which have a rural facing business have also suffered. The monsoon forecast from met department and experts is a welcome news. We hope that will start India’s cycle of recovery and the FM, in fact, has already said yesterday that with better than normal monsoon expectation, growth could go up to as much as 8.5% of GDP.
ET Now: Do you think good monsoon is going to impact in very positive way for you as well as the overall two-wheeler sector is concerned?
SK Munjal: Overall, manufacturing and services businesses will see a revival in demand and certainly the two-wheeler business. Early signs are there in some parts of the country and besides two wheelers, you can see it in commercial vehicles, cars and some parts of the consumer goods. All of them are starting to show signs of recovery. So, I think this is a good sign and I hope the recovery continues and also picks up quicker.
ET Now: How do you read into the Governor Rajan’s remarks that India should not get carried away by the growth superiority?
SK Munjal: I think what he is trying to tell us is be careful, do not get carried away with this positive sentiment alone. There is work to be done. So we have to keep our heads down. Focus on making sure we are doing the right things. Sometimes what happens is when you pat yourself too much on the back, you forget to do more things. So I think it is a good balance to strike. We need to compliment ourselves on some of the things that have been done, but at the same time we should not take our eye off the ball. There is much more work to be done.
Get Unlimited Access to The Economic Times
