PM speech balanced; may help govt for further reforms: CII

Also read: Land bill, power reform next milestone for govt: FICCI

Below is the edited transcript of his interview to CNBC-TV18.

Q: What is your view on the speech made by the PM? He was very clear about communicating the message, the need for why these tough decisions have been taken? Do you believe this will cut ice with the middle class?

A: It is very good that the PM has addressed the nation and explained the situation. It is very clear that the economic steps taken are extremely important for the country. Our growth rate had come down very considerably and it is extremely important the government do everything possible to accelerate the growth rate.

The speech was very balanced and explained to the people why the steps were taken and I think it will help the government take further steps on reforms, which to my mind are very necessary if we have to get our economy growing again.

Q: Are you disappointed that he didn’t articulate what the reform roadmap could possibly look like?

A: No, I didn't expect PM to do that in his speech to the people. The PM explained the steps taken which will enable him to take further steps. If you look at the political situation now, I think the government will be able to take further steps now that Trinamool, which was opposing almost every reform is out of the government and there is sufficient outside support for this government.

Q: How is corporate India getting that kind of confidence because if you talk about any of the big-ticket items even insurance, pension, the land bill, or GST you need numbers in Parliament for all of that to go through. Kapil Sibal said that on insurance one need to have the numbers in Parliament and we don’t, so there is no question of legislative action getting cleared?

A: Correct. The legislative reforms may take a little time. The administrative reforms could be gone ahead with. For example, the finance ministry today itself announced 4-5 reforms. I think these reforms can add value. Legislative reform is the most important reform, which can really be a game-changer is the goods and services tax. 

So, I think the government should concentrate on getting that passed. The CII is working very closely with the states, opposition, and government to get the GST implemented as soon as possible because it will add 1.5-2 percentage points to our GDP growth or the things being equaled.

Q: PM was talking about regaining investor and foreign investor confidence. Do you believe foreign investor is at the end of what they have seen not just this evening, but also over the past one week the actions taken by this government are going to feel a lot more confident about the India story?

A: Yes, I do feel so. I think the perception has changed. I think if you look at the GAAR recommendations submitted a few days ago, the discussions on the retrospective amendments etc. I think it has changed the perception. The perception has improved and I think it can further improve if we continue on this path.