Buffeted by an extraordinary global economic situation, squeezing profits and shrinking domestic demand, India Inc is worried about the rising rhetoric on protectionism emanating from the industrialised countries. Besides, the threat of dumping of cheap Chinese products in India is real and serious. Venu Srinivasan, managing director, Sundaram-Clayton Ltd and chairman and managing director, TVS Motor Company Ltd, who has recently taken over as the president of Confederation of Indian Industry (CII) spoke to Hindustan Times on a range of issues. Excerpts:
Protectionism is the latest buzzword in mainstream debate on international economics. What are your fears as an industry leader ?
The real threat of discrimination for India is in the area of services. India’s export of services contributes a great deal to the economy. Protectionism will set the world back by 20 years. The second and more important aspect is about the import threat from China. There is no transparency in accounting and pricing of export products in China. The threat from China is a serious and a sinister one because it is not transparent. There is an urgent need, therefore, to strengthen the anti-dumping mechanism.
Don’t you think excessive use of the anti-dumping mechanism would backfire in the WTO negotiations?
No. I don’t think so. There has to be a substantial and strong evidence to impose anti-dumping. In any case, many of our members have complained about the long time taken in imposing anti-dumping duties.
The other side of the argument is that anti-dumping is also a form of protectionist measure. Your comments?
Anti-dumping is entirely compliant under the rules of World Trade Organisation (WTO). We have also had issues on contamination of products, sanitary and phyto-sanitary measures and other non-trade barriers. We are WTO compliant and continue to remain so.
What are your ( CII’s) views on election funding?
We would like to have transparent funding. Under current laws, companies are allowed to fund political parties, provided they make necessary disclosures. I think that is the right way to do it.
The Congress party in its election manifesto has said it would pursue affirmative action in the private sector. Your comments on the progress made by CII members on affirmative action in the last five years.
We focus on entrepreneurship development, employment and training. We have identified districts, which have a dominant schedule caste and schedule tribe population. We have tied up with the Entrepreneurship Development Institute (EDI) who would train persons to start businesses of their own. In my company, I had removed the caste line from the appointment application form 30 years ago. I do not know which caste my employees belong to and I do not intend to know either. Finding out the caste of employees would amount to opening a Pandora’s box.