CII congratulates PM for 'staying the course on reforms'

With his actions last week and the address to the nation on Friday evening, the Prime Minister, Dr Manmohan Singh, has unambiguously sent a message that the government is determined to see through the reforms that have been at the centre of the political controversy lately.

This is most encouraging and CII congratulates the prime minister and his cabinet colleagues for staying the course on reforms.

CII hopes that this is the beginning of a series of reforms that the country needs to arrest the economic downtrend and to ensure higher growth for greater inclusiveness, said Mr Adi Godrej, President, CII in a release issued in Delhi on Saturday.

Drawing comparison with the economic liberalisation of early nineties, the CII release said that when India had the first round of economic liberalisation and reforms in 1991, there was pain and apprehension. The economics was not fully appreciated.

"We are two decades down the line. I don't think there is anyone in India, who feels we embarked on the wrong path then, looking at it in hindsight. It is to be noted that every government since then, irrespective of their political colour has taken that process forward. The economic logic of these reforms has been too compelling for anyone to ignore. Even the benefits to the larger population has been so pronounced that no one can criticise these measures. Per capita income of India has grown several fold and India is the second fastest growing large economy of the world and we have also seen poverty come down over the last two decades." Mr Godrej added.

Referring to the Prime Minister's address the Press Release said that CII has always advocated that bold reforms necessarily need good communication for the larger masses of the country to understand the reasons for these actions and from that point of view the prime minister's address is just the right thing.

Mr Godrej said that bold economic decisions often are received with apprehension and are sometimes accompanied by short periods of pain, but the medium to long term benefits from these actions compensate adequately for the short periods of difficulty. The increase in the prices of diesel and LPG can be seen in this context, where the fuel subsidies have become unsustainable and an improved fiscal position would help the overall economy.

In conclusion, Mr Godrej said that the Prime Minister's credentials as a reformist are well known and with this new wave, CII is confident that Dr Manmohan Singh would carry through a series of other reforms, which are necessary for the economy. Mr Godrej made particular reference to GST, land acquisition, power and procedural reforms in this context.