The government's policy paralysis has tarnished the image
of brand India and adversely affected the sentiments of foreign investors, Adi Godrej, the new president of Confederation of Indian Industry (CII) has said.
CII has asked Prime Minister Manmohan Singh to fast track economic reforms
, which in turn would boost investments and accelerate growth, Godrej said.
"With the series of happenings and some rollbacks, clearly the brand India image is hampered and it has impacted long-term foreign investment. It is imperative that the focus should be on reforms
and good governance," Godrej said at a CII conference in New Delhi on Thursday.
"We met the PM yesterday (Wednesday) and discussed with him about taking the reforms process forward. This will help in improving the perception about India's image, attract more investments and revive the growth," he added.
"But the damage is not something which cannot be reversed. The need of the hour is that we improve our governance and put reforms on the fast track. If we are able to do so, the image can be revived. Our main focus for the current fiscal is to revive growth and reforms and improving governance. I strongly feel that we are at the crossroads between choosing business as usual and nine per cent-plus growth. I choose the latter and would urge the government to focus on reforms and governance."
Godrej was also highly critical of the retrospective amendment of the Income Tax Act.
"The retro amendment has created a very negative sentiment among investors," he said.
According to Godrej, 68 amendment Bills are pending related to the real sector and finance sector.
"We are already engaging with government and other political parties to push for reforms in critical areas like goods and service tax (GST), direct taxes code (DTC) and FDI (foreign direct investment). Second-generation reforms in the areas of land acquisition, power, agriculture and acceptance of GST and FDI in multi-retail brand are key to the proposed growth trajectory," he added.
The CII president said at a time when the global economic situation is not conducive, holding reforms will have a negative impact.
"Industrial growth has slowed down to 4.5 per cent from 7.4 per cent, which is a matter of concern. Even if services sector manages to hold on, it maybe moderated this year with industry slowing down," Godrej said.
He identified GST as a key reform required to boost growth.
"GST is major reform which is proposed by the government. GST implementation alone can increase GDP growth by 1-1.5 per cent We are talking to political parties, state governments, and I am hopeful that it will be passed in the Parliament in this financial year."
The policy paralysis in the government has earlier been criticised by Wipro chief Aziz Premji and Bajaj Group chairman Rahul Bajaj as well.
At a meeting of the PM's council of trade and industry
, Singh had said: "I confess that it is a little disappointing to sometimes hear negative comments emanating from our business leadership or be told that government's policies are causing slowdown and pessimism in the industrial sector." Courtesy: Mail Today