ET Awards 2014: Time to focus on micro-level policy changes, says Jaspal Bindra, Group ED & CEO, Asia, Standard Chartered

At a time of renewed excitement at home and abroad about India’s huge economic potential, the ET Awards allow us to identify and celebrate the achievements of India’s vibrant business community.

The new government has some big challenges ahead, but has already brought a renewed optimism and strong hope that economic recovery is round the corner.

Recent economic pain has led some commentators to ignore India’s strong underlying economic fundamentals: a skilled and young workforce, strong consumption, increasing household savings and a robust entrepreneurial spirit. Harnessing the demographic dividend, increased urbanisation and the huge number of new middle class consumers; investing in infrastructure; reforming labour and capital markets; and increasing efficiency in the public sector, should allow the Indian economy to surge to 8% growth.

Achhe din can only be delivered if we also focus on micro-level policy changes, removing bottlenecks and increasing regulatory efficiency. We welcome the scale of the government’s ambition to cut bureaucratic red tape; provide increased clarity and certainty in laws, regulation and planning; introduce large-scale digitisation of government functions, and for labour market reforms.

Delivery on these fronts will dramatically improve the ease of doing business and strengthen domestic and international confidence in investing in India.

However, the economy is still facing cyclical and structural headwinds, and the impact of these reforms on economic growth might be felt only with a lag. It is important not to be discouraged by short-term challenges and keep faith that critical macro reforms will deliver over the medium and long term. Signalling that the government will not be dissuaded from reforms, despite any short-term political pain, will help keep asset markets buoyant and investors patient as they await a sustained recovery.