Bereft of detail, India Inc-FM tango ends on a high:CII

Adi Godrej, president, Confederation of Indian Industry (CII) who was one of the key participants in the finance minister's interaction with representatives of Indian industry, explains to CNBC-TV18 that the finance minister was very receptive of the industry's concerns and indicated that process of reform and fiscal consolidation would be accelerated.

Below is an edited transcript of the interview on CNBC-TV18. Q: What did the finance minister articulate in terms of future policy decisions in the backdrop of a big-ticket Cabinet meeting scheduled for Thursday with an agenda of 18 items, including the Companies Bill and the Competition Act, pertaining to the economic agenda could be taken up?
A: Though the finance minister did not delve into any particular detail, we clearly got the impression that the economic reform agenda will be taken forward. Industry representatives suggested that more reform measures should be announced soon and that the perception of India had improved. Representative mentioned that the measures announced have already had a salubrious effect on the stock market and on the appreciation of the rupee. Q: What did the finance minister indicate in terms of being able to meet the fiscal-deficit target?
A: He did not specifically mention anything on the Kelkar Committee report. It was very clear that the finance minister is very keen to see that the fiscal consolidation does take place. All the suggestions that industry provided were keenly considered. Q: Did the finance minister articulate anything on disinvestment?
A: No. Though the finance minister did not specifically articulate on disinvestment, we clearly got the impression that disinvestment momentum is strongly on. Personally, I feel that the government could not just achieve the target, but exceed it. Q: Did the government indicate that it could exceed the disinvestment target of Rs 30,000 crore for this fiscal?
A: Yes. However this was not specifically articulated. Q: With plans to discuss and announce reforms in the insurance and pension sectors by the Cabinet in a meeting on Thursday, fears of inadequate support in the Lower House have raise concerns regarding the government's ability to get the reforms ratified. Did finance minister reveal these concerns?
A: No. He did mention that both those bills were very important for the finance ministry and the government. The finance minister requested industry associations to speak and convince the Opposition to support these reforms which are important for the country.
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In fact, on one or two reforms, the Opposition has already expressed solidarity. Industry associations, especially the CII, promised to convince the Opposition to support the rest of the reform agenda in Parliament. Q: But was he confident of being able to push forward both the Insurance and Pension Bills?
A: I don't think any specific confidence was expressed. Clearly, he was keen that these reforms would be passed in Parliament and asked the industry associations to take this matter up with the Opposition. Q: Did the finance minister indicate if the Land Acquisition Bill would be taken up and cleared and the possibility of an implementation with retrospective effect?
A: No, we did not discuss any such detail. But industry representatives clearly communicated that the Land Acquisition Bill had to be suitably reframed to ensure that the cost of land doesn’t get prohibitive for industrial and infrastructure development. Q: What was the sense you got in terms of the interest rate trajectory?
A: We clearly indicated to the finance minister that a reduction of 100 basis points was extremely important for the acceleration of GDP growth and help fight inflation Q: So do you expect more policy action and reforms?
A: Yes, that is my personal expectation.