The domestic industry hopes that the spate of economic reforms announced by the Government will be a “mood lifter”, improving India’s global perceptions and have a positive effect on its sovereign rating.
On Friday, the Cabinet cleared pending proposals on easing FDI norms in multi-brand retail, aviation, power trading exchanges and broadcasting. This comes a day after the burden on fuel price subsidies were eased through a hike in diesel price and putting an annual cap on use of LPG cylinders.
Adi Godrej, President, CII, said that the announcements have “restarted the reform process”. CII said that easing FDI norms would help mobilise capital into these sectors and improve India’s current account deficit situation.
“Increasing FDI caps in broadcasting industry to bring it at par with telecom sector will also facilitate the process of convergence in communication and entertainment technologies and attract more players in the cable networks sector,” Godrej said.
On opening of FDI in multi-brand retail, FICCI President, R.V. Kanoria, said that the move signals to the investor community that India is committed to furthering reforms.
“The States have been allowed to take a final decision on this subject and we are hopeful that they will respond positively to this policy initiative,” he said.
Assocham saluted Prime Minister Manmohan Singh for his “exceptional courage amidst stiff opposition”.
Meanwhile, Sunil Bharti Mittal, Chairman and Group CEO of Bharti Enterprises, congratulated the Government on its “bold decisions”.
He added, “This sends out a clear message to the global investor community that the Government is committed to taking forward next generation economic reforms.”
Venu Srinivasan, Chairman and Managing Director, TVS Motor Company, said the reforms are positive steps which will give Indian industry greater confidence and also put the country back on track.
Paresh Parekh, Tax Partner - Retail Practice, Ernst & Young India, said the reforms are a big welcome and one of boldest steps.
“I hope this will be reflective of new era of reforms and re-instil investor confidence in India. Global retailers will now definitely get back to their drawing boards to explore India plans.”
PwC India’s Executive Director (Retail), Akash Gupt, said that FDI in retail will help the farmers maximise their earnings and value.
“Indian retail players are today bleeding and they will have access to overseas funds which will allow the Indian players to harvest their value and be a partner in the retail growth story,” he said.
