New Delhi: Strong action to spur consumption, investments and net exports will take GDP growth rates much higher, according to Vikram Kirloskar, President, Confederation of Indian Industry (CII) and Chairman and MD, Kirloskar Systems Ltd and Vice Chairman, Toyota Kirloskar.
Addressing his first press conference after assuming office, the CII President said, “This is the right time for India to think big and envision GDP growth rate of 10 percent to greatly improve development outcomes. With a landslide electoral victory and new Council of Ministers in place, we expect the Government to engage strongly with industry to ideate and implement impactful policy solutions for double-digit growth,” stressed Mr Kirloskar.
He added, “Given recent data releases, CII is according high attention to four key issues of energizing growth, generating new jobs, deepening India’s overseas footprint, and energy security. CII is focussing on strengthening Indian industry’s role in policy solutions as well as targeted action initiatives under the theme of Competitiveness of India Inc: India@75 – Forging Ahead.”
With GDP growth moderating in the last quarter, the CII President emphasized four key drivers for reinvigorating the growth rate, namely boosting consumption, investments, public expenditure on social and physical infrastructure and net exports.
Consumption will be greatly encouraged by reducing the personal income tax burden, adding more disposable income for consumers, noted Mr Kirloskar.
“As the Government has greatly improved ease of doing business, it must now focus on significantly slashing the cost of doing business. Mega connectivity and storage projects are required across the country for lowering logistics costs which render Indian goods uncompetitive,” he stated. The required policy actions include cutting interest rates, rationalising taxes on equity capital, addressing delayed payments from the public sector, and improving logistics.
The CII President suggested triple-pronged approach for job creation, relating to employment intensive sectors, skilling, and labour reforms for enterprise creation. He placed strong emphasis on accelerating growth in job creating sectors such as construction, hospitality, logistics, healthcare, and the financial sector, among others. According to CII, construction and healthcare alone can create 20 million jobs in the next 5 years.
Boosting net exports and enhancing overseas investments is an imperative for the nation at the current juncture. India should target merchandise exports of $400 billion for 2019-20 from $331 billion now, stated Kirloskar.