The Centre is firming up plans for fiscal and policy support to the industry in a bid to boost employment generation and the country's overall economic growth, according to Commerce and Industry Minister Suresh Prabhu.
However, private sector representatives said it would take at least a year more for them to start re-investing in all the major sectors.
Speaking to reporters on the sidelines of the World Economic Forum's India Economic Summit (WEF-IES), Mr. Prabhu said, “We are doing a sector-wise study... and finding out where there is scope for improvement to provide necessary policy as well as fiscal support... to create more jobs, enhance industrial production and boost the country’s growth, which is already on a high-growth trajectory.”
Earlier, speaking at a WEF-IES session, the Minister said the government will take more measures to further improve ease of doing business in the country as well as India's ranking in the World Bank's 'Doing Business' Report.
“Our aspiration is to become one of the easiest places to do business... The government's job is to provide the enabling environment for the industry to do business," the Minister said, adding that discussions are on with the industry, exporters and start-ups in this regard. In addition, efforts are on to help the industry make use of the capacity that is currently lying idle.
Essar Group director Prashant Ruia said, it would take another year for the private sector to start re-investing in the major sectors, adding that large amount of private investment made during the last five years has resulted in huge surplus capacity. “...we are quickly reaching the point where that surplus capacity will get consumed in various sectors in the country... My own view is that it will take another year at least for the private sector to start re-investing.”
Amitabh Kant, Chief Executive Officer, NITI Aayog said lots of investment has been made by the government in roads, rail and civil aviation. Increased allocation in the Mahatma Gandhi National Rural Employment Guarantee scheme, and rural housing will create more growth in rural areas, he said.
On the auto sector, Mr. Kant said the government was working closely with the auto industry to help in the shift from BS IV directly to BS VI emission norms — by skipping BS V altogether. A lot of investments by both public and private sector has been done in this regard, he said, adding that the industry would be given adequate time to reap the advantages of investments that has been made for BS VI.
On electric vehicles, he said price of batteries will fall from $273 to $73 by around 2030, and that will be the ‘tipping point’ when electric vehicles will take off. He added that the government wants to ensure that India becomes the global hub for manufacturing and exports of electric vehicles.
The government is keen on manufacturing zones being set up near the coastal regions and ports, he said, adding that such zones will help companies to import primary products and intermediates, value-add and export them.
Sumit Sawhney, country CEO and Managing Director, Renault India said, it stressful shifting from BS IV to BS VI, something which took Europe 11 years to do. "We are practically moving in three years now... There was a huge disparity because international players like us have to come to India and actually downsize our technologies to meet the local requirements. So I think it's a catching up for domestic players and international manufacturers. We have that technology."
