Tide should turn on private investments soon, says Rajiv Kumar

Rajiv Kumar, former vice chairman of Niti Aayog

India’s private investments which has been lagging for several years are poised to pick up soon, according to the former vice chairman of the top federal thinktank Niti Aayog.

“I think very much so,” Rajiv Kumar said, when asked if he sees the tide turning soon for private investments. “And both foreign and domestic investor will recognize very soon that this government’s clear intention is to help, promote it.”

Kumar was speaking at the inaugural Moneycontrol Policy Next - The Rs 10 Trillion Infra Push summit in New Delhi on March 23.

“I am convinced that it will happened because of all the liberalization that has taken place,” he added.

Kumar cited the quite significant investments coming under the production-linked investments schemes launched by the Narendra Modi administration.

Under the PLI schemes, India has been offering incentives on annual incremental sales to boost local manufacturing in a host of sectors ranging from automobiles, white goods, pharmaceuticals to solar photovoltaic modules. The programme is part of New Delhi’s broader goal to help reduce imports and boost exports of manufactured products, in an attempt to secure a foothold in the global supply chain that is undergoing a shift from China following the Covid-19 pandemic.

“This is in the making. There is a gestation period. But I am sure that as we go forward, these 14 sectors that are sunrise sectors… things will change completely.”

As India aims to become a developed economy by 2047, the government has kept an unrelenting focus on boosting infrastructure. India’s spending on infrastructure has gone up manifold times over the last decade to hit a record Rs 10 trillion for the next financial year. As part of the same journey, Moneycontrol Policy Next Series of exclusive events was launched on March 23.

Formalisation of the economy, certain degree of uncertainty over retrospective policies and the pandemic have been in part responsible for subdued investments, Rajiv Kumar said.

However, he is confident of a turnaround and expects growth to pick up to the 8 percent handle.

“This government is clearly aligned to this view that it is the private sector which will make the India story happen and let’s do whatever we can to do so.”