It's time for the 15th edition of the CNBC-TV18 India Business Leader Awards (IBLA) and the process to shortlist the candidates kicked off in Mumbai with the jury round on Wednesday. The event was attended by the minister of state for finance, Anurag Thakur, as well as some of the biggest names of India Inc.
On this occasion Shereen Bhan spoke to Anurag Thakur, MoS Finance, Aditya Puri, MD of HDFC Bank, Rajnish Kumar, Chairman of SBI, Sanjiv Puri, CMD of ITC, Varun Berry, MD of Britannia, Zia Mody of AZB Partners and Zarin Daruwala, CEO of Standard Chartered Bank to get their views on the state of the economy.
Thakur said, "The government has a very clear economic policy, we have set our target, timeline, trajectory, to achieve the target of USD 5 trillion economy mark by 2024-2025 and this historic corporate tax rate cut was in that direction only to get more investment and growth and to push the economy."
On the possibility of personal income tax rate cut Thakur said, "As far as the individuals are concerned, with the help of the bankers sitting here to boost that consumption we have organised Grahak Melas from October 03 to October 07. The important thing is the consumption should increase and more investment should be there. Once you earn more then you can think about it, the government needs to earn more as well."
Aditya Puri said that things were moving in the right direction. "When you look at the fact that the government is saying that they are going to spend more on infrastructure, they are going to look at the legal, they are going to look at agriculture and they are going to look at a wider tax base, I do believe that with the festive season as well as more expenditure with the government, I definitely believe the trajectory is up," he said.
Rajnish Kumar spoke about the possible limitation of monetary policy intervention for boosting growth. He said, "In today's time of lower interest rate, does it necessarily lead to investment; that is the question to be answered. I have seen when the interest rates are 10-12 percent, the corporates flocking for money and at one point in time, even credit was rationed at those rates."
Zia Mody warned against hopes of an overnight turnaround. She cautioned, " I don't think that few announcements the government makes have to turn around the mood in a nanosecond. I think there is still a lot of pain, I don't think banks are really ready to lend and open up their balance sheets. I think the PSU banks are stung by a lot of issues and in order for them to release a lot of funds regardless of rate cuts are going to take time.
Sanjiv Puri spoke about India's growth potential and need to increase competitiveness. "India is a growth market, there is huge headroom to grow. For example, in the FMCG segment, while the growth rates have come down, the segment is still growing. So it is a matter of time when the capacity will reach the time, when fresh investments will be required and when fresh investments are evaluated I think certainly the equation is more favourable than it was in the past. We need to keep in mind, it is not like a button that you put on and overnight investment starts, we have to enhance the competitiveness, the attractiveness of these investments and I think the government has taken some steps forward and I am quite optimistic that it will augur well going forward."Varun Berry also said that a turnaround would take time. "As everyone said it is a large ship, it doesn't quickly turnaround, but there is certainly movements in the right direction. The ship is on the right path and I see no reason why this ship should not get to the destination that all of us have been looking at which is that USD 5 trillion economy. However, just to make sure that we get the math right that would mean that the economy would have to grow at almost 12-12.50 percent in terms of dollars. So which would be an uphill task. I think it is good to have dreams, but then making sure that we have put the hands and legs into the dreams as well and execute that to perfection is something that all of us need to do together."