& #8216;Corporate, Political Will Needed For More Reforms & #8217;

In an era marked by extreme volatilities on all fronts, India needed to pursue its economic and financial reforms more vigorously to effectively compete for foreign direct investment (FDI) flows, said Claude Smadja, chairman of Smadja & Associates Inc, Switzerland.

Cautioning against a declining appetite for further economic reforms in the developing countries at a dinner plenary session of the ninth CII Partnership Summit which opened here on Sunday, Smadja said India had to exhibit both, corporate and political will to carry on reforms in sync with global changes.

He called for a new mindset among corporate executives to address problems arising out of geopolitical, political and social issues, as these would largely determine the success of businesses.

The persistent recession in Europe and a series of corporate scandals across the globe had caused a sense of risk aversion, which should be taken note of by developing countries like India, he said.

They should accelerate the process of legitimising free markets and capitalism to attract investments, he added.

In this regard, Smadja noted that India had recorded an honourable growth of 6 per cent, but would have to do better to woo foreign funds.

According to him, China will be able to sustain the 8 per cent growth through continued labour and financial reforms.

Predicting that a global turnaround was in the offing, the Swiss thinker, nevertheless, held up three wild cards.

These are the impending war in Iraq; sagging entrepreneurial spirit in the wake of recession and corporate scandals; and a volatile monetary situation which could swing either in favour of dollar or against it. However, he foresaw a limited and short-term impact of an Iraq war on the global economy.

Lastly, Smadja summed up his views stating that India should aim at becoming a manufacturing hub for the world.

Juxtaposed with his views were those of chief minister N Chandrababu Naidu who reposed faith in the resilience and inherent strengths of India to survive all kinds of adverse happenings, natural or man-made.

The country, with abundant natural and human resources, had already withstood a severe drought and was on the course to pursue the second generation of reforms, the chief minister said.

He added Andhra Pradesh had pioneered reforms in many sectors to create conducive environment for business and industrial growth.