As CNBC-TV18 celebrates 10 years of honoring leadership at the highest levels of India Inc through its flagship event - the India Business Leader Awards, Shereen Bhan caught up with the jury for this year's awards and began by asking NR Narayana Murthy - the chairman of this year's jury about the promise held out by the new leadership in terms of the pace of economic reforms and whether India was "future proofed" for the next five years.
Below is the verbatim transcript of the interview of D Shivkumar, Narayana Murthy, Deepak Parekh, Naina Lal Kidwai and Cyril Shroff with Shereen Bhan on CNBC-TV18
Q: In the context of the issue of leadership, everybody is talking about India. The World Bank is talking about the Modi dividend; the stock markets are talking about the hope rally. We have now seen a position where people are talking about possible re-rating of India. Just in terms of the leadership change and what the new leadership is promising in terms of economic reforms the pace of reforms what do you make of the India story and do you believe that we are at least future proofed for the next five years as far as India is concerned?
Murthy: Mr Modi is very charismatic personality. He has bought a new sense of confidence. He has created high aspirations for our people; this is the first step in any leadership task. The second step is to ensure that people work hard, are disciplined, bring in some new ideas and make sure they happen.
So the first step to some extent has been done. We still have a long way to go and I am positive knowing Mr Modi as I do he would certainly make sure that other steps also happen.
Q: The sense one gets is that while people like what they hear in terms of what this government is articulating, they want to see the climax. They want to see how this is all going to end? The proof of the pudding is in the eating so to speak. Are you cautiously optimistic, nervous optimistic or just confident about the India story today?
Parekh: I am reasonably confident about the India Story. The changes that Mr Modi has to make are mostly legislative changes, labour reforms, land acquisition and goods and services tax (GST). These can't be done in a hurry, this takes time but the Prime Minister is leading from the front. He has created huge expectations and not only in India but all over the world.
Q: The risk of creating huge expectations is also that if you don't live up to those expectations then the disappointment is equally high.
Parekh: But if we want to get back in three-four years to the nine percent gross domestic product (GDP) growth we need to have high expectations.
Q: But do you believe we are likely to get back to the nine percent kind of GDP growth?
Parekh: I personally think every year we can increase at least 100 basis point of GDP growth.
Q: Without legislative reforms?
Parekh: With some legislative reforms.
Q: Would you agree? Get back to a nine percent kind of growth trajectory with some legislative reform over the next three to four years?
Kidwai: I believe we have some low hanging fruit, GST is one where analysis suggest that you add two percent just by brining it in, so these sorts of reforms which are very clearly on the agenda of this government. In fact one of the first things our Finance Minister did was begin to tackle this are in fact some of the ways that these government could very quickly achieve this and I do believe that the natural rate of growth for India has to be at eight percent. We have been there before and we can get back there very quickly.
Q: But things like GST, as Mr Parekh was saying require legislative change. If you just look at what happened in the first session of this government in Parliament we didn't see really very much headway as far as legislative action was concerned. On that basis do you feel that perhaps when it comes to legislative reform we may have to wait longer but when it comes to things like fixing the nuts and bolts to make it easier for people to do business, which is what the Prime Minister is promising, perhaps we could see some headway there?
Kidwai: Of course it is easier and the mood change is certainly one way. If you look at companies who had possibly moved away from thinking of investing in India, India is back on the radar screen. Have they actually signed the cheques may be not but the mood changes become important to bring that investment back in, so that is an early win.
We were in the US at the time of Prime Minister visit and the interest again in the talented non resident community to return to give to India also begins to win in an environment of hope and progress and change. So these are some of the early benefits that India does gain from even while we wait for the tougher legislative changes to happen but I still believe there is a lot to that you don't need legislative changes; tax administration.
Tax administration isn't above legislative change it is about the way we execute on existing tax laws and tax reforms therein. Those have got to be easy wins.
Q: Would you agree that while the mood has changed the cheque books are out but the cheque are not been written just yet, what is it going to take for cheques to be written?
Shroff: Firstly we should look at it as a test match and not as a T20. That is probably the first just in terms of setting the expectations and there are multiple dimensions to this. There is legislative, tax reform, there is a whole sort of administrative reform and multiple people are in involved. To expect only government to do something is probably just putting the responsibility on one constituency. Industry needs to do it and every stakeholder really has a role to play in this and needs to understand that responsibility.
Leadership is key and we have a fantastic leader in terms of the nation, in terms of inspiring us but it has to trickle down to all constituencies and speaking from the profession that I come from role of law is also important. One of the big worries of international investor is certainty because there is a lot of anxiety and uncertainty about whether there is really a functioning role of law here. We do wear it on our sleeve very often and it stands out prominently in comparison with many other markets but then you have a lot of investment thesis on critical large investment which suddenly just vanished. I don't want to mention a specific case but that spooks out investors a lot.
It is much more holistic, we need to sort of take our time over it and do it thoroughly and sensibly and not expect any immediate sort of outcomes in the short term. The journey is well set, the direction is very clear and I am very hopeful. I quite agree with both Ms Naina and Mr Deepak.
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