It is a start of a new year as the CNBC-TV18 poll has showed people believe that 2013 is going to be a better year for the Indian economy. Unraveling the reasons for the upbeat mood on 2013, on CNBC-TV18, are Adi Godrej, chairman, Godrej Group and president, CII and Kris Gopalakrishnan, co-chairman of Infosys Technologies and president-designate, CII.
Below is an edited transcript of the discussion on CNBC-TV18
Q: The fiscal cliff has been averted in the US for now and the Senate has voted in favour of the Fiscal Cliff Bill. But what is this going to mean for the US economy which is starting to recover at a very gradual pace. What will this mean for the rest of the world?
Gopalakrishnan: The US is the largest economy in the world and it has started recovering. It is very important for the global economy that the US economy starts to do well. So by averting the fiscal cliff I think it has been a positive for the global economy, especially for economies like India.
Q: How confident are corporate leaders in the US about the state of their economy and the recovery that it has managed to kick-start?
Gopalakrishnan: Business leaders, with growth returning to economies like China and India, a new leadership in Japan and the recovery in the US, are slightly positive on 2013 at this point. Though Europe will take some time to recover, it is certain that the EU will stay together. But 2013 also opens with uncertainty in the short-term, so business leaders- even though they are positive- they are little still cautious.
Q: We are at the start of a new calendar year and by all account, if you gauge the business confidence, the expectations of growth and inflation the mood is that 2013 is likely to be a better year than the one gone by. What are your own expectations?
Godrej: I think calendar year 2013 will be much better for the Indian economy for several reasons. One, is I expect the global economy will do better. Europe seems to be on the path of recovery and the second half of 2013 should show some growth in the European economies and China seems to be doing better in 2013.
That will clearly help India do better. At home, the pace of reforms, investor-friendly amendments and steps taken to ensure that large projects are implemented through the formation of the Cabinet Committee are enough proof that 2013 will be a much better year than 2012.
Q: Is a breakthrough on Goods and Service Tax (GST) likely soon and how successful were the discussions with the state governments?
Godrej: I do hope it is soon. A lot of effort has been taken both the finance minister and the committees. CII met several Chief Ministers, members of the Opposition and the FM on the issue and the discussions have been positive.