New Delhi Newly-elected FICCI President Sanjiv Mehta on Monday said India needs to focus on ease of doing business, consistent tax policy and low cost of capital to achieve sustained growth rate of over eight per cent over the long term.
He also underlined the need for sustained efforts to promote private investment for higher economic growth in the long term.
Mehta took over as the President of Federation of Indian Chambers of Commerce and Industry (FICCI) earlier this month.
Mehta said, “We need to sustain growth of over eight per cent on a sustained basis which will be a challenge. It is expected to achieve more than nine per cent economic growth in the current year as many sectors are already at pre-COVID-19 levels. But have arrived.” Said in conversation.
He said India would be close to a US$ 3 trillion economy by the end of the current fiscal, and “we need long-term growth on a high ground”.
The Reserve Bank of India has projected GDP growth at 9.5% for the current fiscal year ended March 2022.
He further said that there are positive signs in the economy as tax collections are increasing, and exports are also nearing USD 400 billion.
He said that Foreign Direct Investment (FDI) is also increasing, which is a positive sign for the economy.
Mehta, however, said that private investment is yet to pick up and in such a situation, the government needs to keep spending money to give a boost to the economy.
The president of the industry body also underlined the need to bring down the cost of capital, which according to him was higher than interest rates in competing countries.
On the possibility of Omicron affecting economic activity, Mehta said the spread of the new coronavirus variant is a matter of concern, and the only way to fight it is through rapid vaccination.
He said that the government should speed up the vaccination campaign. With regard to the booster dose, he said that it can be considered based on the advice of experts.
Referring to his meeting with Prime Minister Narendra Modi on Monday, the FICCI Chairman said that during the interaction, he talked about accelerating R&D (research and development) activities with special focus on Biotechnology, Greentech and Digitech. made a case for
“We need centers of excellence in R&D to become a world leader. Indians should file more patents,” he said, lamenting that the number of Indians filing patents is comparable to that of China and the US. is less.
According to him, the government should also focus more on MSME (Micro, Small and Medium Enterprises) and agriculture sectors. He said that the MSME sector is a big employer, but agriculture will bring more prosperity to rural India.
Asked whether there is any case for the RBI to further reduce the interest rate, Mehta said the central bank will have to do a balancing act and hoped that it will take an appropriate decision.
Mehta is the Chairman and Managing Director of Hindustan Unilever Limited, President of Unilever South Asia and a member of the Unilever Leadership Executive.
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