The Hindu : National : Tatas pullout will be a setback to industry: CII

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Tatas pullout will be a setback to industry: CII

M. Dinesh Varma

The country’s image among investors will also be dented

Project has run into rough weather after Nano grabbed world attention as design, technology marvel
“India should adapt to the changing game of international trade”

CHENNAI: Confederation of Indian Industry Director-General Chandrajit Banerjee on Monday called for a concerted political effort to urgently end the impasse faced by Tata’s Nano plant at Singur, West Bengal.

The implications of a possible pullout by the Tatas would not be limited to the stakeholders — the West Bengal government, the company, political parties or the new recruits in Singur — and it would be a huge setback to industry and India’s image among investors, Mr. Banerjee told The Hindu here.

The irony

Pointing to the irony of the project running into rough weather after the Nano had grabbed world attention as a design and technology marvel, he said it was “absolutely unbelievable” that the political process which was expected to facilitate the fruition of the small car project should threaten its future. Nothing about the project was done illegally.

Inflation blues

As for inflation, the CII chief, while terming it a serious issue, pointed out that it was a concomitant of strident growth.

He sought to allay undue concerns at the fallout of what was essentially an “imported phenomenon.”

“For one, the investment pipeline remains strong…an estimated $700 billion in the next three years … that by itself should be fuelling growth.”

Pressure on prices

However, a high interest regime — as a result of regulatory response — was bound to exert pressure on input prices and could badly hit some sectors such as engineering and textiles.

More than overcoming inflation, which was bound to ease off once market correction set in, it was critical to evolve an enabling environment for the economy to get out of the trough, Mr. Banerjee said.

The CII prescription involved a mission mode scale-up of infrastructure through fast-tracking pending clearances for various projects of power, ports or roads, the advocacy of a PPP approach to logistics building, directing exports into markets in Africa, Latin America and Central Asia, and ensuring manufacturing competitiveness.

“India needs to look at international markets differently and adapt to the changing game of international trade,” Mr. Banerjee said.

The country also had to look at investment-led trade instead of focussing only on exports. And the strategy to compete against China should be to proffer a different basket of value-added products instead of just raw materials.

For inclusive growth

A key component of the CII’s vision for the future was to bridge fundamental gaps in education and skills across the country to set the stage for inclusive growth.

“No one realises more than industry the fact that equitable growth alone can make enterprises sustainable,” he said.

Skill development

The CII has embarked on district-level skilling initiatives in 24 States with the support of corporates which choose the expertise they want to evolve.

It has also signed a memorandum of understanding with IGNOU to provide English language and soft skills training across 62 centres. The initiative expects to generate an estimated one lakh employable candidates by the end of 2009. Among the other initiatives are a “visioning” exercise across 25 States to conceive and implement road maps for a city or State against an “India at 75” projection, curriculum revision at 147 ITIs, corporate adoption of villages and promoting women entrepreneurship.

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