India Inc repeats demands at meet with Sharma, FM

Every time the macroeconomic numbers go down, the government takes consultations from industry associations for feedback and suggestions on how to improve the situation. But, are these implemented? Had it been so, industry chambers would not have repeated their demands on and on in these meetings, said experts.

This time, too, when the industrial output contracted by 1.8 per cent in June, year on year, Commerce and Industry Minister Anand Sharma called a meeting of the task force on trade and industry, which he created in July 2011, to discuss ways to boost the manufacturing sector. The meeting was held on Thursday. Chambers and other industry players were more focused on Thursday and wanted the government to take steps on reviving the economy “immediately”. India Inc was, in fact, assured of some major announcements within a few weeks, those in the know of things said.

Several such meetings were held in recent months, including the ones with the chairman of the prime minister’s economic advisory council, C Rangarajan. In these meetings, the Confederation of Indian Industry (CII) has been demanding an economic revival package, while the Federation of Indian Chambers of Commerce and Industry (Ficci) has been putting forward its 12-point agenda.

The issues raised at almost every meeting include the oft-repeated demand for reducing policy rates by the RBI, liberalisation of foreign direct investment, implementation of the Goods and Services Tax (GST) from April 1, 2013, and sorting out land acquisition issues to “boost” investment sentiment.

At a meeting with Finance Minister P Chidambaram on Thursday, chambers repeated these demands, besides raising the issue of clarity on the tax front.

Though some industry analysts, who refused to be quoted, questioned the efficacy of these repeated demands, chambers feel these meetings are important to familiarise the government with industry inputs.

“At least some things come out of the consultations,” said Ficci president R V Kanoria. CII director general Chandrajit Banerjee felt certain things “need repetition”.

As long as these issues do not get resolved, they will get repeated, Kanoria said, suggesting the government will have to take risks to improve the situation.

Some of those who attended the meeting on Thursday did not entirely agree with the criticism of repetitive nature of the demands by the chambers. They said some issues that cropped up in the recent past like industrial relations in the Maruti plant at Manesar and power grid failures were also discussed.

Banerjee said when chambers present industry concerns at these meetings, the points are heard by various ministries. “Inter-ministerial co-ordination has improved,” he said.

Kanoria prescribed that the government should co-ordinate more effectively within its ministries and with the RBI.

It is not that the demands of the industry are not met at all. Signing of the fuel supply agreement by Coal India Limited with several power producers, setting of infrastructure target by the Prime Minister and constituting an investment tracking system are some of the achievements of these meetings, including the ones with Prime Minister Manmohan Singh.