Since the beginning of the year, there has been discussion about the risk of a global recession—a decline in global per capita GDP, caused by the rapid worsening of growth prospects, increasing inflation, and tightening financial conditions. With this lies a big question, is the Indian economy on top of things amidst the current global economic recession?
To answer the question and elaborate more on the Federation of Indian Chambers of Commerce and Industry’s (FICCI) outlook for the year 2022-23, Union Budget expectations, and most significantly the FICCI impact areas, the newly appointed President Subhrakant Panda shares his insights in an exclusive interview.
“Let not short-term turbulence distract us from the real goal which is the tremendous opportunity that India represents. We will be the third-largest economy in the world by the end of the decade”, said Subhrakant Panda, President of FICCI.
Talking about the kind of impact of the global recession on the Indian economy, the FICCI President said that at the start of the pandemic, the way India approached the situation was absolutely spot on in terms of the timing and the quantum of stimulus measures. He also added that all over the world wherever there was an excess of stimulus, inflation has been elevated and has been far more stubborn to deal with.
FICCI President Subhrakant Panda said, “India also had its fight with inflation, but with the fiscal and monetary measures working in tandem, we have now seen inflation come within the tolerance band of the central bank.” He further added that the fight against inflation cannot be declared an early victory, instead one has to remain alert and the focus needs to shift to growth.
Answering where India is positioned at the moment, FICCI President Panda said, “I think we are as well prepared as we have ever been for any type of situation.” According to him, with the world bank having upgraded the growth forecast on account of robust economic activity, as far as FY-23 is concerned, a growth of about 7% is expected. He also mentioned that inflation is within control but there are challenges ahead that have more to do with the global situation. Saying that India needs to expect and prepare for some degree of turbulence next year, FICCI President informed, RBI and the Central Government are working in tandem to put their best foot forward.
What are the industry expectations?
With regard to the upcoming budget, FICCI President shared his views on what are the industry expectations and said, “It will be something which is supportive of growth.” He said that the industry expects the budget to be action-oriented. He assured that the budget will focus on reforms, and growth while also lending a helping hand to those at the bottom of the pyramid, the vulnerable, who need help the most.
Talking about the private sector CAPEX coming into play, FICCI President said that the finance minister is ready to lend a helping hand in terms of enabling policies and making a supportive environment. He said, “Government’s claim of enabling Ease of doing business is happening on the ground and this process gathered momentum during the pandemic.”
He further added that the government took a deep dive into where substantial progress could be made on ease of doing business. He also informed that FICCI is also engaged at multiple levels with the government by giving suggestions about how the initiative could be enhanced. As per President Panda, the Government is providing market access to domestic industry to make them Atmanirbhar and is focusing on an impressive strategic move of ‘Make in India’ and ‘Make for World’.
“India has the scope and scale to produce not just for the domestic market but also for exports”, President Subhrakant Panda suggested that India should eventually look at research and development and innovation so that it is not just making in India, for India and the world but also gets transitioned to designing and innovating in India.
FICCI President Subhrakant Panda informed that MSMEs and North-east states will be the specific areas of focus under his presidency. He informed that a working group has been set up to reach out to MSME members and to assess their access to finance, source of the finance, and their market access, are they able to take the advantage of GeM Portal.
For the last 8 years, FICCI has had an annual north-east connectivity summit, President Subhrakant informed that this year he would like to give an added focus on looking at economic development linked to connectivity in border areas.
Talking about his Presidency, he shared that he is very privileged to be at the helm of FICCI at this critical juncture. Concluding his answer, he said that the role of FICCI given its rich legacy of 95 years and its vast membership base is to act as a platform that collects and collates inputs from all stakeholders and acts as an agent of change, where the meaningful contribution is made to the country’s agenda of sustainable and inclusive growth.