India to witness growth despite challenges: CII President

Confederation of Indian Industry (CII) President Rakesh Bharti Mittal on Tuesday predicted a 7.3-7.7 percent growth in 2018-19 in spite of challenges in the global economy.

He said, "CII predicts 7.3-7.7 percent growth in 2018-19 and expects it to strengthen further in the few years to come. This in spite of some challenges in the global economy, including hardening of interest rate regimes, volatility in oil prices, etc."

Mittal highlighted the reforms over the past four years and further stated that Goods and Services Tax (GST), Insolvency and Bankruptcy Code were the most relevant reforms that would change the way business was done in the country.

The CII President said that the state governments working proactively on ease of doing business were getting better investments and business interest and the Government of India's ranking of states played a good role in that.

Responding to a question on how the large non-performing asset (NPA) accumulation should be dealt with, Mittal said that the CII was contemplating setting up of a very large asset reconstruction institution or a "bad bank," which would help clean up the banking system of the stressed assets and allow for unfettered credit flow.

Speaking on the credit growth, the CII President said that this was the most welcome feature. However, he added that many small and medium enterprises (SMEs) were still struggling to get credit and even when they did, their cost of credit was high, making their business operations difficult.

On job creation, Mittal went on to say that while new jobs were created in the formal sector itself, there were many more created in the informal sector and those were not being tracked. As an example, he mentioned that huge growth in MUDRA loans, which indicated the livelihood creation in sectors, that were mostly out of the statistical radar.

On greater inclusion as an agenda for the industry, the CII President mentioned that corporate social responsibility (CSR) activities would be a focus for CII this year.

On the farm sector, Mittal said the news that the government was planning to launch ranking of states on agriculture reforms was a great one. In order for the government to achieve its target of doubling farmers' income, the focus needed to be on rural infrastructure, land/ power reforms, water management, micro-irrigation, moving to high-value crops, farmers' freedom to sell directly food processors/ retailers in addition to APMC markets. These would lead to large-scale private sector investments and increase in farmers' income, he added.