Harsh Pati Singhania, president of Ficci and managing director of JK Paper, says that though the new year will be better than the last, certain steps of caution must be taken as this is just the beginning of the recovery. He told Hindustan Times that the revival is due to the fiscal stimulus package and easy monetary policy and therefore “real” growth could still be some distance away. Excerpts.
On the outlook for 2010?
It should be much better than what we have seen in 2009. Signals are positive globally not just in India. India’s growth figures are encouraging but let’s understand that this is stimulus led. The easy monetary policy has also been a great boon.
On steel Lakshmi Mittal’s comment on governments not being equipped to deal with mega investments
There is some element of truth in it. There are several large projects in the pipeline but there must be a system dealing with timeline and a proper process ensuring their execution.
On the lessons learnt from the slowdown
We realised the potential of our domestic market. India has managed to get out of the crisis much earlier due to a strong domestic market. Though exports form an integral part of the economy, the dependence is significantly less compared to other economies.
On the areas of concern
Developing skill set for employability is crucial. Just pure degree-based education would not be sufficient to create jobs. We also need to provide a boost to investments. It is not happening the way it should. There should not be any tightening of fiscal or monetary policies at this point. Real growth still has not gained momentum. The RBI should continue with the easy monetary policy. An increase in interest rates at this point may derail recovery.