Analysts feel that that a weak Congress will resort to populist measures to counter the effects of the Assembly elections. Even some industry top honchos believe that it too early to predict the economic stance of the government and the Union Budget will be the deciding factor.
All eyes are on Finance Minister Pranab Mukherjee, who will present the Budget on March 16.
Adi Godrej, chairman and managing director of Godrej Group, and president-elect of the Confederation of Indian Industry, says the Budget will be a deciding factor. "It is difficult to tell now (the impact on economy and industry). The government has to spell it out and present a bold Budget. Until we get to know from the Budget as to what the government's agenda is, it is difficult to tell," he said.
Some analysts feel that the Congress-led United Progressive Alliance-II government will have a tough time pushing its tough economic reforms agenda ahead.
Ajay Bodke, head of investment strategy and advisory, Prabhudas Lilladher, said: "In our view, the policy drift in New Delhi is likely to continue and the urge to push through reforms aggressively in the face of opposition from allies and the Opposition may continue to take a backseat."
However, some captains of industry feel that reforms will continue.
"The outcome of the Assembly elections will not affect the economy. The central government is very strong. There will be no change in policy and I don't think there will be any problem for the government at all," said Venugopal N. Dhoot, chairman, Videocon Group.
Courtesy: Mail Today