Slow decision making, stalled reforms initiatives and rising borrowing costs are hurting investment and affecting growth in the broader economy, the Confederation of Indian Industry (CII) said on Thursday.
“We met the prime minister (on Wednesday) and discussed with him about taking the reforms process forward,” Adi Godrej, the new CII president, told a news conference. “This will help in improving perception about India’s image, attract more investments and revive growth.”
India’s economy is forecast to grow at a slower 6.9% in 2011-12, hit by a crippling industrial deceleration and hurt by rising credit costs and waning demand. It grew by 8.4% in the previous year.
The domestic industry has been ratcheting up their demand for ushering faster reforms to boost investor sentiments. “Our perception is worse than reality. We need to improve both,” Godrej said.
The government is battling surging perceptions of of policy paralysis, criticism for a series of scandals and macroeconomic concerns. Political compulsions had coerced the government last year to quickly bottle up a flurry of reformist moves, including allowing foreign direct investment (FDI) in multi-brand retail.
“We will work closely with central government, state governments and Opposition parties to form a consensus on reforms,” Godrej said.