Many bright spots in India’s economic narrative: Birla

Speaking at the annual general meeting of Hindalco Industries Ltd on Tuesday, Birla said the aluminum company has announced total capital expenditure of about $8 billion over the next five years from its US business Novelis and in India.

“The economic recovery cycle in India remains strong, thanks to significant progress on vaccination and increased public capital expenditure. Even during Covid, various government schemes helped small and medium enterprises and the worst-affected sections of the population tide over the crisis. Activity indicators are now well ahead of pre-Covid levels, and most estimates put India’s potential economic growth in FY13 at over 7%,” Birla said.

He said India’s inflation rate has been above the Reserve Bank of India’s tolerance limit for some time, but the overshoot has not been as severe as in many other countries. Birla said the monetary and fiscal authorities have taken steps to ease inflationary pressures and a normal monsoon this year will help ease these pressures further.

“Even with the widening trade deficit, India’s external indicators remain supported – forex reserves equal to over nine months of imports. With these expectations, India is well positioned to weather the uncertain global economic environment.”

“Thus, while businesses will need to be cautious about financial market volatility and cost pressures this year, one expects the economy to show an improvement in medium to long-term growth,” he said.

Talking about Hindalco’s capital expenditure plans, Birla said that 70% of the company’s consolidated cash flow will be allocated to high-growth downstream sectors such as electric vehicles, mobility, packaging, batteries and consumer durables.

“Building on solid financial performance and a strong balance sheet, your Company is well positioned to drive a new wave of transformational growth driven by organic expansion. We have invested in Novelis and India with total capital of approximately $8 billion over the next five years. Expenditure announced.

“Novelis has identified potential investment opportunities of $4.5 billion. We have identified potential investment opportunities of about $3 billion in the India business.

Highlighting the positives for the Indian economy, Birla said that the dynamism in India’s digital ecosystem, diversification of global supply chains away from China and greater investor emphasis on sustainable finance provide new opportunities for India. “India has a strong pipeline of infrastructure projects. In addition, practical policies of the government, such as production incentive schemes, are helping. Many industries have seen new project investment announcements. Foreign direct investment inflows have been strong. The burden of non-performing assets in the banking sector has come down. Startups and technology based new age enterprises have gained critical mass. These sectors are showing a strong momentum, providing new jobs and enhancing the customer experience,” Birla said.

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