Govt should focus on confidence-building: Ajit Ranade

In an interview to CNBC-TV18, Ajit Ranade, chief economist, Aditya Birla Group spoke about the state of the economy.

Also Read: Investors have not lost faith; 3% GDP fear unfounded, says PM Below is the edited transcript of Ajit Ranade's interview with CNBC-TV18 Q: Did you hear out the prime minister and what would your key takeaways be from what he said? A: Clearly, the challenges are very clear before us. For example, in the manufacturing sector, the growth has been close to zero for almost two years now and that is not due to lack of demand but lack of investment. Possibly, low growth in India is also partly reflected in the higher current account deficit (CAD), which is import of goods. That can be produced in India. The most blatant example of this is import of almost USD 15 billion of coal when in fact we need to have zero imports of coal. India has the third largest coal reserves in the world. It could be earning something like USD 10 billion. Q: I am just asking whether you would have gleaned therefore anything positive from what the PM said because the PM said exactly this. A: I have not been able to listen to the speech, so I will not be able to comment directly on the speech. It was necessary for the prime minister to make a statement because if you want to invite or incentivize investment, the first step is a matter of sentiment and confidence between various measures that are being done. They will all add up. They are all nuts and bolts measures, some monitory and some from the finance ministry. They will all add up but it all has to be kind of packaged in a confidence building signal.