New Government Should Focus on the Ease of Doing Business

By the time this issue of Forbes India gets to you (around May 16), India would have moved on to its next government. We do not know who will head that government, for this Fifth Anniversary Special was planned and executed before the results. But we do know that whoever forms the next government will have to deal with critical issues concerning the economy and policy. The last few years have offered a lesson on how not to run a government. It has been about abdicating responsibility at the highest level, and spending on electoral freebies thinly disguised as efforts at wealth redistribution. But all that is water under the bridge.

Whoever becomes the next Prime Minister will have to quickly move to get the investment cycle restarted, end the policy paralysis, and try and undo the damage done by flawed legislation like the Land Acquisition Act, which tries to remove the market’s logic on land pricing.

If the next PM wants to have a quick view on what his priorities should be, he could do nothing better than to flip through this issue of Forbes India—which is focussed on setting the agenda. Kumar Mangalam Birla, chief of the globalised Aditya Birla Group, had expressed his frustration last year with India in no uncertain terms. “Country risk for India just now is pretty elevated and chances are that for deployment of capital you would look to see if there is an asset overseas rather than in India.”

You can read what Birla thinks needs to be done to revive India’s fortunes in this issue. He believes the rise in Chinese wages gives India a big opportunity to expand our manufacturing base—but only if we make ease of doing business our top priority.

Another industry doyen, Adi Godrej, believes that the corruption scandals of the last few years have made bureaucrats wary about taking decisions. He says, “Bureaucracy has not been taking decisions because of various actions by the Supreme Court, the CAG and others. While some of these may be justified because of corruption, overall it has led to a further deterioration in the ease of doing business.”

It’s not as if business is only asking things for itself from the next PM. Ask Kiran Mazumdar-Shaw of Biocon and she is clear that the “lacunae in our present governance and economic models have thwarted the aspirations of a billion Indians”. The next government will have to “embrace the aspirations of the common man and work on narrowing the gap between the privileged and the underprivileged”.

But there’s more, lot’s more for the next PM to read up on before he takes over. Forbes India would like to celebrate its fifth anniversary by dedicating this issue to the growth and welfare of India, including India Inc, by outlining an agenda for the next PM. The bottomline: We simply have to ease the rigours of doing business to revive growth.

Best,
R Jagannathan
Editor-in-Chief, Forbes India
Email: r.jagannathan@network18online.com
Twitter id: @TheJaggi