Economy turnaround likely from FY15: CII

According to India’s industry stalwarts, there will be no turnaround in the economy before the next financial year, unless the reforms process is expedited and a more aggressive set of measures is put in place to trigger the growth process.

In a CEOs’ survey conducted by the Confederation of India Industry (CII), more than 80 per cent of the respondents don’t see GDP growth for the current year crossing 5.5-per-cent mark. The survey was conducted among 75 national council members.

However, even in the present financial condition, 37 per cent of the respondents did not see a decline in their investment level in the current year. More than 44 per cent of the respondent s affirmed an increase in their domestic investment during the current financial year. While 50 per cent did not predict any change in their foreign investment, 37 per cent saw it increasing during the current financial year.

Responding to the investment scenario, CII director-general Chandrajit Banerjee said,  “This is encouraging development in the midst of negative sentiments in the economy and all efforts should be made to ensure the policy environment enables these intents to be translated on the ground.

We need to see some coordinated action from the various ministries in the government of India, the state governments and the Reserve Bank of India.”

To narrow the current account deficit, which continues to remain high and is exerting a downward pressure on rupee exchange rate, over 50 per cent revealed that fast tracking of reforms process as their first policy priority.

About 20 per cent and 16 per cent ranked liberalising foreign direct investment (FDI) regulations and stronger intervention by RBI, respectively, as their most critical policy measures to address the issue.

When asked about the measures to revive growth,  52 per cent of the respondents accorded their first priority to clearing 50 large projects worth more than01,000 crore and 200 large projects worth between0250 crore and01,000 crore within the next six months. For another 24 per cent of the respondents, RBI intervention by way of cut in repo and CRR rates were among the topmost policy actions. Indicating that the fiscal deficit continues to remain a major issue, a significant 17 per cent of respondents ranked adherence to fiscal deficit target as their top policy priority.