Budget 2013: Focus should be on issue of growth slowdown: Pankaj Vaish

In an interview to CNBC-TV18, Pankaj Vaish, MD & Head of Markets-South Asia, Citigroup shared his reading and outlook on market and the Union Budget 2013.

Below is the verbatim transcript of Vaish's interview with CNBC-TV18. Q: What is in store you think, can the Budget turn around things or do you think that is expecting too much even if he has a credible fiscal plan to turn around the basic growth issue might be difficult or challenging in the Budget? A: The Finance Minister (FM) has already done some remarkable things since September. He and his team has reversed, not only just arrested the freefall but reverse the sentiment. So, kudos to them also particularly because they have taken on some politically difficult issues like on the subsidies. They have done a good job there. However, our concern is growth slowdown and today they will hopefully deliver a very good Budget because the team is very savvy, sophisticated, they have been on the road including with Citi to Hong Kong and have done a masterful job in talking about the India story and the change in sentiment to global investors. Therefore, I do not think they will disappoint. They understand that delivering on 5.3 percent, 4.8 percent and in fact Raghuram Rajan at our Citi MIT Conference also mentioned another further 0.6 drop for the next three year, which was also in the Economic Survey yesterday. They are very much focused on that path. One day's actions and speech is not necessarily powerful enough to be able to turnaround the growth slowdown. There is a lot of stuff that has to come from other ministries, from entrepreneurs, also on the monetary policy front. There are many things to come into the mix to get this growth going. If we are in the four point something (4.x) in the second half of this year even if you say that the Central statistical organization (CSO) estimate is a little bit too pessimistic. 4.x percent is just dangerously closed to what we used to see before the whole miracle. At 4.7-4.8 percent, global investors will probably not think it is worthwhile to mess around with a lot of noise and a lot of back and forth that goes on. That is my worry. You probably have not seen me worried in the long time because we have been very optimistic that the market will head higher and go back to the old highs. None of this is irreversible. It can still be arrested but there is a lot of work to do but the team need a lot of help from quarters beyond north block to deliver that. I am worried about the growth slowdown and I am worried that if we do not get that backup then we will lose a lot of friends and that will not be good especially on the currency front, which creates its own vicious circle.