Wooing global investors, Prime MinisterNarendra Modi on Sunday promised to make India the “easiest” destination to do business with a stable tax regime and a predictable, transparent and fair policy environment.
Pushing his pet theme of manufacturing to boost economic growth and create jobs, he said a single window clearance for projects is being set up at both central and state level.
Stating that the atmosphere of “despair and uncertainty” has gone away within a very short span of seven months, he said, “Since day one, my government is actively working to revive the economy. My government is committed to creating a policy environment that is predictable, transparent and fair.” Modi, who assumed office as Prime Minister in May last year after BJP stormed to power with a huge mandate, said the government is working to provide a policy-driven governance.
“Ease of doing business in India is a prime concern for you and for us. I assure you that we are working very seriously on these issues. We want to make them not only easier than earlier; not only easier than the rest; but we want to make them the easiest,” he said. “We are trying to complete the circle of economic reforms speedily. We are also keen to see that our policies are predictable. We are clear that our tax regime should be stable. In the last few months, we have taken several decisions in this direction,” he said. “… We are not only making commitments and announcements. We are also backing them up with concrete action,” he said.
Speaking at the Vibrant Gujarat Summit here, with leaders from across the world, including top industrialist and US Secretary of State John Kerry, UN Secretary General Ban Ki-moonand World Bank head Jim Yong Kim, in attendance, Modi said that India is on the “path of transformation”. Stating that the government has made commitments to its people for a great future for India in a very short time, he said, “we know that to do this, we need the enabling policy framework. We are working constantly to improve it further”. Assuring investors that the government will “hold your hands whenever needed,” he said: “If you walk one step, we will walk two steps for you.”
The first two quarters of the current financial year beginning April 2014 have seen growth rate which is one per cent higher than the previous year, Modi said, adding that IMF has predicted that India would be the second fastest growing economy in the coming years. According to the Organisation for Economic Co-operation and Development (OECD), India would be the only country among world’s top economies which would increase its pace of growth this year, he said.
Listing out recent initiatives, he said FDI in construction has been liberalised, 100% foreign investment has been allowed in railways, the defence sector has been opened for FDI up to 49% and a similar level in the insurance sector. Government, he said, is “working towards single window clearance at the Federal and State levels”. The Prime Minister said the approach to problems has to change. Recession is talked of in isolation in the context of business and industry, but it results in low-level of per capital income in countries where majority of global population lives.
“I assure this global platform that India wants to work with the global leadership. Be it issues of poverty or ecology,” he said. Spelling out his vision, he said institutions and systems of delivery have to be strengthened. “You may be aware that our economic growth had slowed down during the last few years. Now, my government is putting all efforts to ensure faster and yet inclusive growth. The initial results are very encouraging.”
The focus is on building infrastructure like roads, gas grids, electricity and water systems, farm irrigation and cleaning of rivers through public and private investments. “In order to execute the infrastructure plan, a fast track PPP mechanism is being put in place.” Sagarmala project is of modernising ports and developing new world class ports besides providing better road and rail connectivity for port-led development. Also, digital highways, i-Ways, besides highways, are being created. “To upgrade manufacturing infrastructure, we are setting up world-class investment and industrial regions along with the dedicated freight corridors and industrial corridors,” he said
“India offers you the potential of low-cost manufacturing. India has low-cost and high quality manpower. We are trying to further harness these strengths through better management and good governance,” Modi said.
Employment opportunities are being enhanced by promoting manufacturing, agro-based industries, tourism as well as services. “We have undertaken labour reforms to encourage enterprise and to create a bigger job market for our youth,” he said.
The Prime Minister said the development process should result into benefits for the people along with the economic players. “Our challenge is that we have to work both on the vertical and horizontal fronts. We have to think big while taking adequate care of the smallest person. To meet this challenge, in a faster way, technology and innovation is perhaps the only tool. Therefore, we are committed to placing emphasis on knowledge and innovation, research and development,” he said.
India, he said, is a land for opportunities. “We have to build fast track roads and railways. We have to energise homes and factories on a continuous basis. We have to build infrastructure for cities where almost half of our population lives.” There are immense possibilities for global investors in India, he said, adding the process of development is not incremental but a quantum leap. “We have made commitments to our people. We have made commitments to ourselves. We have made commitments for India’s great future. We have to write our new destiny. And we have to write it in a very short time,” he said. Stating that there was a need for enabling policy framework, he said the strength of Indian democracy and independence of judicial system provide a level-playing field for long lasting business.