Saturday, Oct 21, 2017
Industry & Trade | Asia-Pacific | India

Federation of Indian Chambers of Commerce and Industry

‘You cannot go wrong’


2 years ago

Dr Jyotsna Suri, Immediate Past President of the Federation of Indian Chambers of Commerce & Industry (FICCI) and Chairperson & Managing Director of Bharat Hotels
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Dr Jyotsna Suri

Immediate Past President of the Federation of Indian Chambers of Commerce & Industry (FICCI) and Chairperson & Managing Director of Bharat Hotels
"“Half the battle is won if you know what is ailing you. The government knows what is ailing the business environment and is implementing the necessary reforms.”"

"“FICCI was the first chamber to be made up of only Indian entrepreneurs and traders. It has a proud history and there is an engagement that is ongoing irrespective of which government is in place. We are not politically aligned; we are aligned to the industry, and to the development of the nation.”"

Comparing entrepreneurial, democratic India to neighboring China is “like comparing apples to oranges” remarks Dr Jyotsna Suri, Immediate Past President of the Federation of Indian Chambers of Commerce and Industry (FICCI), the voice of India’s business and industry for policy change. In an interview with United World, Dr Suri also looks into India’s advantageous business environment for investors, its suitability for a wide range of manufacturing, and the industrious spirit of its people.

 

Could India overtake China as the preeminent developing market player? What is your outlook for the immediate economic future?

India definitely has the potential to be the global leader in growth. The country has been growing, as you know. The predictions are that it will continue to grow over 7.5% in the current and next fiscal year, and over 8-9% in subsequent years. This is absolutely necessary for India due to its demographic conditions. Over 50% of our population is below the age of 25 years. We have a million people joining the workforce every month, meaning we need to add 12 million jobs every year. This necessitates sustained high economic growth. It has to happen and it will happen; we are on the right track. As far as a businessperson like myself is concerned, it is very encouraging.

 

How would you define the progress that Prime Minister Modi’s government has made? How would you respond to critics claiming that considering the mandate Mr Modi had to start out with, he isn’t moving fast enough?

“Fast enough” is a very relative term, because when you compare it with not moving at all, at least there is movement. Now, how can you define “fast enough”? The country has 1.25 billion people, we have 29 states, seven union territories; India is a sub-continent and I personally think that no one can expect a miracle to happen. For anything to happen that will show results, it will take time. Critics have every right to be critical and they should be, as it encourages you to do better, and I appreciate what Jim Rogers is saying for himself. In my point of view, we are moving a little slow, perhaps, when you compare it to the huge expectations that the country has. What I see however is that reforms have been set in motion, and they need to continue.

 

When comparing India to China, India is clearly a democracy. Perhaps one of the reasons why change goes slower is that in India people are always looking for a compromise.

Absolutely. The comparison between India and China is something I hear all the time; I heard it at the Africa summit as well, and I really think it is not fair. It is like comparing apples to oranges. First of all, China is not a vibrant democracy like India is. Secondly, entrepreneurship in China is nowhere near what it is in India. Where is the private enterprise there? Here, Indians are entrepreneurial by nature. There is a huge range and level of enterprises here in India, and we do not want to be compared with China. If China wants to develop 10,000km of road, it can do so at its own will. With India being a democracy, specific procedures have to be followed, such as the land acquisition process, rules of different states, etc., but that is the way it is. So, how can we compare? That is also where the comparison of being fast or slow comes up. China can create its infrastructure in five years, India cannot. It will build the infrastructure, but it will take many more years because of the democracy, because of the country being the way it is.

 

Looking at India’s ease of doing business, it recently jumped 12 spots in the World Bank’s “Ease of Doing Business Index”, yet its’ still 130th out of 189 economies. What do you feel should happen quickly here to attract foreign investors?

We have to spend a trillion dollars on infrastructure, and it has to come from somewhere. The fact that we have moved up in the ranking is a quantum leap as it is not easy to jump so many places in such a short time; I do not believe it has ever happened before. But, we have a long way to go. The ambition is to go to #50 – a lot of work will be required; it will not happen just because we want it to happen. We face the issues of predictability of taxes, and general ease of doing business. The government has done their diagnostic correctly and they are trying to overcome the bottlenecks, which come their way. It will take time, but at least the diagnostics have been done and we know what the problems are. Half the battle is won if you know what is ailing you. The government knows what is ailing the business environment and is implementing the necessary reforms.

 

India also jumped to the top 10 of global investment influx, and the government is raising FDI caps in the service sectors. Where would you say the investment opportunities are today?

We are positioned demographically in such a position that we have to grow. We have the youngest workforce, the demand, and supply in this country. Make in India is about making for India, and the rest of the world. People who come to India to manufacture anything from cars to air conditioners also have a market here. It’s the only buoyant market that I can see right now. The middle class is growing, aspirations are rising and demand potential is high, as they want better quality of life. You cannot go wrong. India has always been a long-term player. If anyone is looking for instant gratification, it is not going to work in India. You have to have patience. If you can be patient and think long-term, then I say come to India, get used to the nuances and you will be a winner. It is the same anywhere in the world. I, for example, am investing in hotels in the United Kingdom, which is a completely different system. I have become accustomed to this, as many people must do so with India.

 

Regarding Make in India, manufacturing represents 15% of GDP with the goal to move to 25%. What is your opinion on this, and of the late president Kalam speaking on the concern of India becoming the low-cost player in the supply chain?

Make in India is brilliant and ambitious; it is a very well founded ambition because it is doable. I am supporting this movement of the Prime Minister because of this reason. As you can notice, we have moved into aerospace, technology, and defense. We must however have balance; I understand the concern for becoming the low-end member of the supply chain. But if balance is being achieved and we are not falling into that bracket, we are on the right track. We will be able to manufacture high-end equipment and also have low-end manufacturing here.

 

Where does FICCI come in with all of this?

FICCI has very intense interaction with its stakeholders. We will now be celebrating our 88th annual general meeting where I am going to hand over the mantle to my next in command and it has been exactly like that for so many years. FICCI was set up on the advice of Mahatma Gandhi and it was the first chamber of commerce and industry made up of only Indian entrepreneurs and traders. Until then, British and other international companies had their own chambers of commerce. It is a proud history and there is an engagement that is ongoing irrespective of which government is in place. We are not politically aligned; we are aligned to the industry, and to the development of the nation. FICCI has friends across party lines. Whichever government may be in place, FICCI’s aim is to support the nation’s development agenda. We continue being industry’s voice for policy change in the country. Parties have taken notice of the independent, unbiased research papers and analysis with recommendations that we produce. All of our research is regularly shared with the government. Many of our recommendations are taken up, which is exactly why we do it. Once we provide them to the government, they advance in the way they wish.

 

Regarding the India-US relationship, Prime Minister Modi has already been twice to the US, and President Obama has been twice here to India, the first sitting US president to do so. They are trying to engage each other because the growth of each country is tied together. If you look at the diaspora of over 3 million Indians living in the US, many are highly educated, affluent, and some leading many US companies. How would you describe bilateral relations today? How would you address US Secretary of Commerce Penny Pritzker when she says that the potential has not been realized?

I completely agree with her. We are sitting at $100 billion in trade. We need to take it up to $500 billion. At this level, both countries are ready to exploit this potential. We have to work on it together. There are issues of commonality, such as both countries have federal systems. We are going into competitive federalism here, which is something that I notice in the US as well, where each state stands up for itself. The government here is empowering states with their self-administration, which is creating new opportunities. The points you mention showcase how things are moving ahead. The average American mind-set towards India is also improving.



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