India Inc upbeat as it sees stable government, push for reforms

16 May 2009,


NEW DELHI: India Inc, too, has given its verdict: It has applauded the people's mandate that seeks the return of the Congress-led United Progressive Alliance (UPA) government, hoping for stability in governance and a major push to economic reforms.

Stung by a fall in industrial output, drop in demand, major dip in exports and an overall slowdown of the Indian economy, leading chambers Saturday said the electoral victory for the Congress-led alliance will now make the environment conducive to tackling these issues.

"This outcome will generate a feel-good factor in the Indian business community as political instability was a major concern," said Amit Mitra, president of the Federation of Indian Chambers of Commerce and Industry (FICCI).

"You will see it on Monday how the stock market behaves with a positive note," Mitra told IANS.

"What is more important is economic revival will be easier and faster with UPA government back in power. They are fully aware of the financial and fiscal conditions and concerns."

The Associated Chambers of Commerce and Industry described the election results as a vote for development and hoped the UPA government will pursue progressive social and economic agenda for inclusive growth and good corporate governance.

The chamber also said the vote was for measures like the rural job guarantee programme, the massive loan waiver for farmers, the numerous schemes to bridge the urban-rural divide and for the civilian nuclear deal with the US.

According to the Confederation of Indian Industry (CII), the verdict was a clear sign that India wanted stability and will send a very strong signal to international investors.

PHD Chamber said that with the UPA government set to assume office again, the industry looked forward to much desired political stability that will create an environment favourable for business.

"We hope the new government will usher in a new wave of reforms to stimulate demand, provide a boost to the investment climate and put the economy on the path of growth," said PHD Chamber president Satish Bagrodia.

Looking ahead, the industry lobbies also had the wish list ready for the new government.

They hoped for pension and banking reforms, go-ahead for foreign investment in retail, private participation in the defence sector, further rationalisation of corporate and individual tax structure and push to the farm sector.

"We already have a 100-day agenda for the new government and we will hand it over to the prime minister as soon as he takes charge. Reform will happen with a much faster pace," said FICCI president Harsh Pati Singhania.

"It is also crucial to bring about a second Green Revolution, a skill revolution and a retail revolution," he said, adding the focus should remain on inclusive growth for long-term progress with economic and social justice.

CII, on its part, said the government must focus on three areas given the pain India Inc has had to endure over the past year. The chamber listed them as tax cuts, infrastructure development and lower interest rate.