“The message was clear, there is a political commitment to turn the Covid crisis into an opportunity by resetting policies so that we can achieve higher levels of growth when things start returning to normal. It was a sign of the bureaucracy to move decisively,” a senior official, privy to some discussions, told TOI.
This was followed by a series of measures announced by the Finance Minister Nirmala Sitharaman After consultation with the concerned ministries – for changes from pushing new labor and agriculture laws to public sector policy that focuses on privatization of non-core assets MSME Definition, Incorporation of Ordnance Factories and Rollout of Production Linked Incentives (PLI) Schemes worth about Rs 2 lakh crore in all sectors.
In the midst of all this, there were measures that were not part of the original plan as the government decided to reverse controversial retrospective amendments to tax laws and revamp the policy framework for mobile companies to ease their financial stress. did – moves that not only took the investors by surprise but also helped them allay some of the pessimism on India.
“Many of these issues, such as changes in labor and agriculture laws or the disinvestment of Air India, have been dragged on for decades,” a government source said.
Officials believe the results are now visible, as they point to a recent upgrade in the outlook for India’s sovereign rating from negative to stable. “Though it may take a little longer, the overall message for investors is very positive. All these help create enthusiasm and more funds will try to invest in India, which can also be joined by retail investors from some countries,” said a senior executive of a leading financial services company. He warned that high valuations of Indian stocks could be the only deterrent.
to the government – which until a few months ago was accused of losing its appetite for reforms, a charge for which he has never pleaded guilty and which he has consistently attributed to a conservative definition of what constitutes “reform” and bias Is – this is clearly the result he expected. Many commentators and critics had argued that the Modi government had abandoned initiatives to boost economic activity and focused more on such issues. Ram Mandir and cancel the article
370. After the seemingly impossible task of selling AI, officials who dismiss this notion – gleefully pointing to recent records – argue about how the government was working in this direction.
The message has not gone down to investors as companies, which previously relied only on China, are looking to re-examine production strategies. Officials point to Apple vendors who were lured into setting up a manufacturing base in India, or white goods players such as Panasonic Or Daikin which are queued on the PLI window.
With more privatization transactions in the pipeline as well as large and still growing interest from investors in the asset monetization sector, the government believes that it has laid the building blocks to propel the economy in the coming months.
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