NEW DELHI, Dec 24: Whenever the economy goes into a downward spiral, policies aligned with growth ambitions are a far cry and the industry suffers, vocal leaders of India Inc are usually the first ones to raise the red flag. But not against the BJP-led government in 2019, except a few.
Those who stood out were the likes of Rahul Bajaj, Kiran Mazumdar-Shaw and Ajay Piramal for their words in an otherwise seemingly insulated, blissful world of their fellow corporate leaders even when India’s rapidly slowing GDP growth touched a six-year low at 4.5 per cent in the second quarter as manufacturing output slumped and consumer demand as well as private investment weakened.
In visible signs of economic woes, the auto sector went through one of the longest sales slumps leading to nearly 3.5 lakh job losses. In the FMCG sector, concerns persisted that consumers were thinking twice even before buying a Rs 5-pack. The telecom segment continued to be under the pump, so was the stressed power sector.
Adding to the problems, non-performing assets plagued banks while two major non-banking financial companies (NBFCs) — IL&FS and DHFL — crashed. Still, the leading lights from India’s corporate world could not hold up the mirror to the government.
For once, it was the “silent Prime Minister” — Manmohan Singh, now a vocal Opposition member — who did the talking on behalf those who blamed him for ‘policy paralysis’ and criticised him while he was at the helm for being weak, indecisive and silent.
Writing on The Hindu newspaper on November 18, Singh wrote that there was “a palpable climate of fear in our society today”.
“Many industrialists tell me that they live in fear of harassment by government authorities. Bankers are reluctant to make new loans, for fear of retribution. Entrepreneurs are hesitant to put up fresh projects, for fear of failure attributed to ulterior motives. Technology start-ups, an important new engine of economic growth and jobs, seem to live under a shadow of constant surveillance and deep suspicion,” he wrote.
Not long after, at an event organised by the Economic Times in Mumbai on November 30, where Home Minister Amit Shah, Finance Minister Nirmala Sitharaman, and Commerce Minister Piyush Goyal were present, industrialist Rahul Bajaj spoke about the government’s stifling of criticism, among other things.
“This environment of fear, it’s definitely on our minds. “You (the government) are doing good work; and despite that, we don’t have the confidence that you’ll appreciate criticism,” the veteran industrialist said.
His apprehensions of criticism not being appreciated was met with a tweet by Sitharaman, who said, “…Questions/criticisms are heard and answered/addressed. Always a better way to seek an answer than spreading one’s own impressions which, on gaining traction, can hurt national interest”.
Bajaj found support from Biocon CMD Kiran Mazumdar-Shaw who hoped that the government would reach out to India Inc for working out solutions to revive consumption and growth.
“So far we are all pariahs n (sic) govt does not want to hear any criticism of our economy,” she had tweeted.
Replying to Sitharaman’s response to Bajaj, Shaw retorted, “Madam we are neither anti-national nor anti-government”.
Shaw further said, “We want you to succeed big time as fastest growing economy n (sic) rise to the top of the global league of economies. I am a proud apolitical National n (sic) only want the Govt to promote good policies including at State level.”
RP-Sanjiv Goenka Group Chairman Sanjiv Goenka, however, disagreed with Bajaj’s views and asserted that there was no fear among industrialists.
Speaking at the India Today Conclave East 2019, Goenka lauded the Narendra Modi-led government for taking up steps to reach out to the common man and bring structural changes.
“For the first time in several years, I see the will and the determination to do a structural change. In the past, it was pretty much the way it was. For the first time, I see changes at different levels,” Goenka said.
To be fair to Piramal Group Chairman Ajay Piramal, it was he who first mustered up the courage to tell the government in September that all was not well in the relationship between the industry and the ruling dispensation, and that mistrust between government and businesses was growing due to frequent raids, searches and lookout notices by various agencies on corporates.
“Today, I see there is a gap, there is mistrust between the people who are in power and the people who are wealth-creators,” he said.
“Why do we need to have everything criminalised if there is a charge of an offence against you? With so much of information available, with so much of data available, do you need to have searches and raids? Do you need to have lookout notices issued? It does not give a positive feeling to any businessman,” Piramal asked.
He further said “what is critical is that wealth-creators get the respect they deserve.”
A little before him, L&T non-executive Chairman AM Naik had raised a faint voice while speaking on the sidelines of the company’s AGM in August, hinting to challenging times faced by private sector to make investments.
Asking where the liquidity and the money was, he reminded the government, “Lots of promises were made during the elections, and you have to fulfil them now.”
The industry veteran also raised questions on government data credibility, saying one has to use his or her own judgement while believing in the official numbers.
Towards the fag-end of the year, some more leaders joined in to raise their concerns.
Even when India climbed 14 rungs in the World Bank’s Ease of Doing Business ranking to stand at the 63rd position and figured among the world’s top 10 most improved countries, Bharti Enterprises Chairman Sunil Mittal wanted more, so did his fellow industrialist and industry chamber CII president Vikram Kirloskar, who at a pre-Budget meeting with Sitharaman spoke about further ease of doing business.
In 2020 the industry will hope to have more freedom to perform and even more freedom in raising concerns to the government without fear. (PTI)
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