India’s quest to become atmanirbhar (self-sufficient) is a “well-planned economic strategy” to turn the country into a global manufacturing powerhouse, Prime Minister Narendra Modi told 20 major global investors and invited them to be part of a “New India “in-the-making that would be free from old practices.
“Today, India is changing and for the better. From fiscal irresponsibility to fiscal prudence, from high inflation to low inflation, from reckless loans that create non-performing assets [NPAs] to loans based on merit, from infrastructure deficits to infrastructure surpluses, from poorly managed urban growth to holistic and balanced growth and from physical infrastructure to digital, ”he said at the virtual roundtable of global investors organized on Thursday night by the ministry of finance and the National Investment and Infrastructure Fund (IFRS).
The roundtable focused on discussions on India’s economic and investment prospects, structural reforms and the government’s vision for the path to a $ 5 trillion economy, said a person present at the meeting who requested anonymity. .
“It was timely as the pandemic-affected Indian economy is rapidly recovering from a record low and is encouraging investment,” the person said.
India, which is Asia’s third-largest economy after China and Japan, experienced a record contraction of 23.9% in the first quarter of the current financial year due to the Covid-19 outbreak and subsequent nationwide lockdown restrictions. of 68 days from March 25.
“But there are some clear signs of economic recovery,” he said. The collection of the goods and services tax (GST), an indicator of consumption, experienced a year-on-year jump of 10% in October and the Purchasing Managers Index (PMI) for both manufacturing (58.9) and services ( 54.1) showed an expansion last month. .
Prime Minister Modi said that the world witnessed India’s determination and determination to fight the pandemic. “India has shown remarkable resilience in this pandemic, whether it’s fighting the virus or ensuring economic stability,” he said.
“I am happy to see your enthusiasm for enhancing your engagement with us,” said PM, adding that India is committed to sustainable growth. “Today, investors are moving towards companies that have a high environmental, social and governance level. [ESG] Punctuation. India already has systems and companies that rank high in this. India believes in going down the growth path with the same focus on ESG, ”he said.
When applying for investments, PM said: “I am aware that I am addressing some of the best financial brains. Those who can turn new areas of innovation and growth into sustainable business proposals. At the same time, I am aware of your requirement to provide the funds in your trust, the best and safest long-term returns ”.
According to an official from the Ministry of Finance, large pension funds and sovereign wealth funds such as Australian Super, British Columbia Investment Management Corporation, Future Fund, GIC, Japan Post Bank, Japan Bank for International Cooperation, Korean Investment Corporation, Mubadala, Nippon Life, Pension Denmark, Qatar Investment Authority and the US International Development Finance Corporation participated in the virtual conference.
The prime minister said that India is the best place to generate long-term returns, as it is among the countries with the lowest corporate tax rates and listed the political decisions made to allow private enterprise to prosper in the country.
“Strategic divestment and asset monetization on a scale never seen before. Historic decision to reduce our stake in public sector companies below 51 percent. Policy regimes for private participation in new sectors such as coal, space, atomic energy, railways, civil aviation and defense. New Policy on Public Sector Commitments for a streamlined footprint of the public sector, ”he said.
“If you want reliable returns, India is the place to be. If you want to demand democracy, India is the place to be. If you want stability with sustainability, India is the place to be. If you want green growth, India is the place to be, ”he said.
By inviting investors to participate in India’s growth, the prime minister said the country has the potential to catalyze the global economic resurgence. “Any achievement by India will have a multiplier impact on the development and well-being of the world. A strong and vibrant India can contribute to the stabilization of the world economic order, ”he said.
Mark Machin, President and CEO of CPP Investments, commented that the panel discussion was very productive. “India is key to our long-term investment strategy, focused on growth markets, and we have a strong appetite to leverage our existing investments in the infrastructure, industrial and consumer sectors,” he said in a statement from the Ministry of Finance.
“India is an important market for CDPQ; we have invested several billion in sectors such as renewable energy, logistics, financial services and technology-based services, and we aim to strengthen our presence in the coming years,” said Charles Emond, President and CEO of Caisse de dépôt et location du Québec (CDPQ), he said.
“Pension fund investors dedicate a large part of their portfolios to assets that are expected to benefit from growing economies and markets. The structural reforms undertaken by India are likely to provide a solid foundation for such high growth in the future, ”said Jase Auby, chief investment officer for the Teachers Retirement System of Texas, USA.
Divakar Vijayasarathy, founder and managing partner of DVS Advisors LLP, said that atmanirbhar Bharat is at the core of the Prime Minister’s economic vision. “He has also highlighted the change in culture at the macro level from fiscal responsibility to fiscal prudence, from unplanned urban growth to comprehensive growth, from physical infrastructure to digital infrastructure.”
“The missing link of atmanirbhar Bharat would be the FTAs [free trade agreements] to boost export demand and additional measures to reactivate and sustain domestic demand ”, he added.
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