Course Correction
As the Narendra Modi government starts work in the second term, it faces an economy that is in a bad shape. The big driver of the economy, rural India, is in trouble. Add to that slowing consumption, exports not growing enough, fall in sales of automobiles and worrisome prospects on the monsoon this year. What can the new Finance Minister, Nirmala Sitharaman, do in the Union Budget to provide the much needed boost to the economy?
To discuss this, Business Today organised a roundtable discussion. The participants included Arvind Virmani, former Chief Economic Advisor in the finance ministry and Chairman, Foundation for Economic Growth & Welfare; Dhruv M. Sawhney, Chairman & Managing Director, Triveni Engineering and Industries; Mahendra Singhi, MD & CEO, Dalmia Cement; Sunil Sinha, Principal Economist, India Ratings; Bidisha Ganguly, Chief Economist, CII; and Amit Rana, Partner, Tax & Regulatory, PwC. The discussion was moderated by Prosenjit Datta, Editor, Business Today. Edited excerpts:
Prosenjit Datta: What do you think are the opportunities and threats that the budget can address?
Arvind Virmani: There is a domestic angle and an external one. Annual growth has been slowing in the last two years. A subset of that is what we are going through. That is a threat, but I am not sure if it is going to be addressed much in the budget. On the external side, the threats are in terms of sanctions and trade, but it is also important to focus on opportunity.
The opportunity from this tariff war is that supply chains are clearly shifting. People who have invested in China are shifting to other countries, and India comes up pretty high. The opportunity is to make manufacturing in India real. There is the whole
