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Four years after he last addressed an annual general meeting of India’s leading industry associations, Prime Minister Manmohan Singh walked into a packed FICCI auditorium this morning to muted applause.
Weeks after the government won a crucial battle to bring foreign direct investment (FDI) into multi-brand retail and subsequently, continued with key reforms, including clearing the contested Land Acquisition Bill and establishing a Cabinet Committee on Investments, Singh’s presence here gained further importance.
Maybe that is why, before he arrived, the three FICCI brass — Kanoria Chemicals and Industries’ Kanoria, HSBC India chief Naina Lal Kidwai and Xpro India chairman Sidharth Birla — who later joined Singh on the stage, milled about restlessly before a front row packed with corporate leaders.
Singh did not disappoint. “The steps we have taken recently are only the beginning of a process to revive our economy and take it back to its trend growth rate of 8 to 9 per cent,” the Prime Minister said.
“Today, we meet after a year or two of excessive pessimism at home, which in turn has hurt the growth process,” he added, “But I stand before you to reassure you that our government is committed to doing everything that is possible to alter the policy environment, accelerate economic growth and make the growth process socially and regionally more inclusive.”
When the Prime Minister finished, the applause was loud, if not deafening, but a message of cautious optimism had reached India Inc. “I think the resolve of the government to go forward, that 8-9 per cent economic growth is very much in the sights, (was) a very important message communicated by the Prime Minister,” said Kidwai, the first woman FICCI president-elect .
“I think there is an overall realisation in the government that reforms have to continue, so to that extent he has given a message that the government will continue the reforms journey, which is very welcome,” Marico chairman and managing director Harsh Mariwala said. “I agree that we need to do much more but at least there is some positive movement.”
Despite the limited confidence that Singh’s speech generated towards a government till recently accused of policy paralysis, Bharti Enterprises vice chairman Rajan Mittal reasoned that a commitment to reforms had been shown. “I’m hoping that as consensus was made on certain issues last week, more issues, as the Prime Minister alluded to banking, insurance and pension (reforms), will also be met,” he said.
“I think it’s an important signal that he has sent out, and that again the economy is at the forefront of his thinking,” said Wockhardt chairman Habil Khorakiwala. “It also means that the country is facing enormous economic challenges if nothing is done and therefore, it requires the participation of the corporate world actively in reviving the economy.”
After an extended period of cynicism, the government’s recent spine and Singh’s words may have assuaged India Inc somewhat. But as the audience walked out of the auditorium, an overcast December sky reminded that the gloom has not yet completely lifted.