ET Global Business Summit 2015: India Inc all praise for ordinance moves, sees bright days ahead

NEW DELHI: Economists and industry chiefs on Friday said the prospects for the Indian economy look brighter as the government is expected to press ahead with further reforms.

Renowned economist Jagdish Bhagwati kicked off a panel discussion at the Airtel and The Economic Times Global Business Summit cautioning that the slowdown in China didn't necessarily mean that India will overtake it in terms of growth rate.

But he immediately struck a positive note saying that PM Narendra Modi will push ahead with ending monopolies and the licence era which had resulted in corruption in India. "We're going to see the opening of markets (during Modi government's tenure) and there is nothing like the opening of markets to create competition and lack of rents and therefore growth. We first saw this in 1991 but now it'll move from second gear to third because there's nothing that can be seen in Mr Modi that could prove contrary to this prediction," the Columbia University professor said.

Bharti group chairman Sunil Bharti Mittal said that the government had made a good start, especially when the European economy hasn't recovered, Japan is slowing down and China is dealing with its own problems. "India has again become a 'must-be-in' country after six or seven years... We all want to invest here. No one wants to miss the chance now," he said.

While political parties have been critical of the Modi government's moves to promulgate ordinances in the wake of a Rajya Sabha logjam, business leaders seem to be cheering the move. "We're no more hobbled by the blockages seen in the last UPA government. They have demonstrated leadership by coming out with ordinances and it shows that obstructions of the opposition are dealt with very decisively. These are things missing in the last few years," Mittal said.

Max Group chairman Analjit Singh too saw the Insurance ordinance as a boost but pointed out that some other steps were needed to boost the sector. Asked about retrospective tax, Singh, also the Vodafone chairman, said the industry was watching the government's moves. "Leave Vodafone on one side. Frankly, it won't make or break Vodafone or India. But the fact is that style of working has broken the back of business and that needs to be fixed."

Biocon CMD Kiran Mazumdar-Shaw suggested that the government should further deregulate and free up businesses through steps such as self-certification. Boston Consulting Group chairman Hans-Paul Burkner pointed out that there are three critical issues that foreign investors are concerned about —speed, stability and flexibility.