In conversation with Siddharth Zarabi, Managing Editor Business Today TV at the ongoing World Economic Forum (WEF) event at Davos India’s top voices weighed in on India's investment story.
“While the rest of the world is handling their own stressors, and I am hearing the word exacerbated much more after a pandemic that it's exacerbated by the Ukraine crisis, political instability, and inflation. When they talk about India, they say that there is a story that is unfolding. There is some amount of optimism that here's a country that has almost eight different COVID-19 vaccines. The pandemic story is definitely something to be told. There's a strong state and central presence in India. For India, the economic situation and investment potential is hopeful,” said Shobana Kamineni, Executive Vice-Chairperson, Apollo Hospitals Enterprise.
Further talking about India’s economic growth, Arjun Dhawan, Vice Chairman, HCC Ltd said that India finally has an infrastructure program that it deserves one and a half trillion is planned to be invested in the next five years. “If India is to actually be part of the committee of nations, we need to execute that and our track record thus far has been very strong. In fact, we have decoupled from the world a little bit in terms of having exercised really wonderful fiscal constraint during corporate,” said Dhawan.
“We didn't print a lot of money instead we actually invested in long-term yielding assets like infrastructure that's what's generated that nearly nine percent GDP growth this past year which will continue to be sustainable the next couple of years now as an emerging market and we're the sixth largest economy in the world. We are the third largest on a purchasing power,” he said.
Dhawan said that India has its own challenges but alongside the country have those massive opportunities not just for Indian businesses but for the world. “We have a unique opportunity today as we create infrastructure and we plan not for the next five to ten but for the next 50 years,” he said adding that to overcome any challenges speedy dispute resolution is the bedrock of any capitalist economy.
While cement is the bedrock of all the ambitions of a country with good quality houses, cement prices have increased. When asked about inflation and cost-push pressure coming as a big challenge because of the two years of pandemic, Mahendra Singhi, MD & CEO, Dalmia Cement (Bharat) Limited said that the inflation or fuel prices now are mind-boggling.
“We've never seen such prices. Still, cement companies have been to absorb the cost increase. And this is why they are not making profits they are not looking at it only from a profit motive,” he said.
“The cement companies of India are quite innovative and that's why they have been able to manage to some extent but if you look at the results you will find net profit margin has gone down badly,” he said. Singhi also said that India is the only country that is producing more than 70-75 per cent low carbon cement it means the country is already on the road to ensuring that it becomes climate-friendly.
When asked about the affordable and universal health coverage and the government’s investment in the sector, Kamanie argued that the government needs to step up spending.
“We are spending about three per cent. The state governments and the centre have to spend probably double that if for Health infrastructure. But even if we start working on certain schemes that would reduce the cost of capital for us like,” said Kamanie.
“We should look at blended finance. Sectors like healthcare need to have social bonds. India is the only country in the world that has given COVID-19 vaccines for free. All of us have to be inclusive we have to keep costs down we have to every India,” she said.
The participants also talked of inclusive growth, speedy resolution of court cases that may hamper investment and economic growth opportunities and further boost towards healthcare infrastructure with new policies.
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