New Delhi: In a thumbs up to the new government under Narendra Modi, a whopping 93 per cent CEOs in a survey said that they foresee a substantial improvement in the economic situation of the near term. The apex industry chamber Ficci conducted a quick survey amongst its members to gauge the sentiment post election. The survey results are based on the responses from about 76 CEOs, who are members of Ficci’s National Executive Committee. Ficci said that the decision making machinery at the government level has witnessed a significant slowdown in recent past which has had an impact on growth as well, “With new leadership on board, a majority 93 per cent of the participating CEOs said that they certainly see a reversal as far as this trend is concerned,” said the industry chamber.
The remaining seven per cent were a little sceptical about a change in the decision making machinery. A majority 82 per cent cited a substantial improvement in their business and investment prospects over the next twelve months. However, these CEOs felt that there are a plethora of challenges facing the incoming government. The growth has decelerated quite notably and the situation of the manufacturing sector continues to remain worrisome. “A significant majority of the participants felt that issues related to factors of production- land, labour, capital and power are amongst the most critical challenges that the new government will have to deal with. Inflation and need for tax reforms were also cited as other immediate concern areas,” said Ficci. The industry chamber said that the market for various factors of production has not seen much liberalisation. “Be it land, labour or the capital market, there is a long way to go to ensure optimal utilisation of these resources.”
It said that the availability of land is a prerequisite for industrial development. However, the new Land Acquisition Act makes it virtually impossible to acquire land and industry would likely see a comprehensive review of the same, said Ficci. “All natural resources are scarce and therefore access to these natural resources including land must be at equitable prices. The allocation must be rapid, enforceable and through transparent process,” said the chamber. It noted that labour laws in the country remain archaic and inflexible. “There is an urgent need to review the existing labour laws. The new laws should be such that these create a greater balance between capital and labour intensity,” said the apex industry chamber. Ficci also noted that inflation has been persistently high and remains a major concern area.
