No one talks about the slowdown as a temporary blip anymore, as political gridlock, the central bank’s growth versus inflation dilemma and gloom in the Euro zone have conspired to dampen corporate sentiment in Asia’s third largest economy. The ability of India’s top 1000 companies to service debt has also dipped to a five-year low due to high interest rates and a drop in operating profits. Predictably, companies are delaying big investments that would add much-needed industrial and infrastructure capacity. And it’s become quite common to hear Indian companies blaming a lack of action from a government distracted by corruption scandals and adverse court judgments as key reasons for the cloudy business outlook.
Yet, there are many who say India’s young, aspirational and growing population still gives investors and companies optimism for the long term. As a report in the following pages shows, India’s consumption story is safe, courtesy Bharat, because the factors that are driving rural demand — significant diversification of income, land price rise leading to a wealth effect and government transfer of resources to rural India — will continue. Read how India Inc is trying hard to go that extra mile to woo rural consumers.
There is of course nothing better than getting to know from people in the trenches on how they have made adversity an opportunity. BS 1000 asked three first-generation entrepreneurs to write what they have learnt in the last one year of global uncertainty. Their success stories are inspiring and give hope that India Inc is indeed in safe hands. Also find out how Indian companies, especially those with transnational operations, have put in place contingency risk planning to cope with a volatile world.
BS 1000 is also about celebrating and honouring excellence. A distinguished six-member Jury, led by ICICI Bank and Infosys Chairman K V Kamath, analysed reams of data to select individuals and companies who responded quickly when the tide turned and positioned their organisations for the future. The best example of this spirit is the Business Standard CEO of the Year Rajiv Bajaj, who scripted a remarkable turnaround that saw Bajaj Auto back from the brink onto a recovery path. Over to him and other winners.