Unilever Chairman Hindustan and MD Sanjiv Mehta, who have taken over as a new President of FICCI, ready with a strategy for industrial space – from using Global Giant Management practices to work with MSMEs and focus on climate and innovation.
In an interview, he told the Toi that inflation had an impact on demand and showed that the government needed to continue his capital expenditure plan, while supporting segments vulnerable to more time.
Quote: The latest economic data shows some moderation in activities.
What is your judgment? The economy is still in the process of recovery, it is not the time to declare a victory.
But, there are some things that Augur very well.
First, what we lost as the economy last year, we will – more or less – get back this year.
Tax collection is very good.
GST is now starting to pay dividends.
Export, where we stuck in the range of $ 300 billion, is now in a striking distance of $ 400 billion.
If I see it through demand lenses, private consumption has not taken up to the level we all ask.
And private consumption also has a connection with private investment because the cycle has not started the way we want.
But, there is an exchange feature.
Now, the problem of the twin balance sheet has disappeared from our lexicon because the bank has, more or less, creates the provisions of the NPA and recapitalization of themselves, and the corporation has done it.
So, the capacity to borrow and the capacity to lend has increased significantly.
How do you increase private consumption and demand? Rural requests have slowed before the pandemic.
But during a pandemic, for the last few quarters, it proved very resilient.
The harvest is good, MSKS has increased and government intervention through free food supply and direct money transfers have made a rural population more resilient with the type of pandemic that we have faced.
Government support must continue because (pandemic) is not over.
What is the main challenge for business? Inflation has crawled in and, in some cases, it has never been before – palm oil, crude oil, and even in countries such as India, tea prices compared to two years which significantly increased levels.
This is not an Indian phenomenon, it is all over the world.
This is not a LED request, but the obstacles are more LED supply and, to some extent, it is due to speculation.
In this kind of scenario, the de-hottlenecking supply chain will produce more inventory and, hopefully in the second half of 2022, we must begin to see commodity prices start taking off, which will be very good for our country.
During the intervention period, there was a big role to play for government spending.
So, government expenses for infrastructure should not be withdrawn, and if we have capacity, even more (must be done) because it has a multiplier effect.
What will be your main demands in the budget? The first thing I want is the policy consistency.
When there is certainty of policies and rates, you want to put money.
Last year, when time was so difficult, Minister of Finance Mrs.
had come out with a good budget.
This budget must build it.