A Discussion on global economic scenario is under way between prime minister Narendra Modi and business leaders, including Reliance Industries head Mukesh Ambani, Tata Group Chairman Cyrus Mistry as well as bankers and economists.
The meeting is being attended by over 40 delegates, including Cabnet ministers, top officials of the government and RBI, industry representatives, top bankers and leading economists and sectoral experts, the PTI had reported yesterday, quoting a statement from the Prime Minister’s Office.
On the agenda is ‘Recent Global Events: Opportunities for India’. The meeting is also being attended by RBI Governor Raghuram Rajan and Niti Aayog Vice-Chairman Arvind Panagariya.
The meeting is being held amid turbulence in global markets caused by a slowing Chinese economy, devaluation of the yuan and concerns surrounding the prospect of a US rate hike.
As many as 27 business leaders, bankers and economists have been invited for the meeting to deliberate on the recent developments in the global economy and the opportunities they present for India, sources said.
Other invitees include Bharti Airtel chief Sunil Bharti Mittal, Essar Group head Shashi Ruia, Reliance Group Chairman Anil Ambani, Adani Group head Gautam Adani, ICICI Bank CEO Chanda Kochhar and SBI Chairman Arundhati Bhattacharya.
Mahindra Group Chairman and MD Anand Mahindra and Aditya Birla Group head Kumar Mangalam Birla are said to be among the other invitees for the meeting for which industry chambers’ heads — Sumit Mazumder of CII, Jyotsna Suri of FICCI and Rana Kapoor of Assocham — have also been called.
Finance Secretary Ratan P Watal, Commerce Secretary Rita Teaotia, Economic Affairs Secretary Shaktikanta Das and Chief Economic Advisor Arvind Subramanian will be present at the meeting.
Each speaker will be given three minutes to make initial remarks, sources said.
What’s on agenda
“A wide-ranging discussion is expected on the impact of recent economic events, and how best India can take advantage of them,” the PMO statement said.
The government had earlier said India should take advantage of the global turbulence and look at how to convert it into an opportunity.
The Prime Minister would hear the stakeholders as to how India can take the baton from China and lead global growth, sources added.
Rajan’s presence assumes significance in the context of the recent inflation-deflation debate and his views on global economy.
Chipping in the debate on how India can be the driver of global growth as China slows, he recently said it will be “a long time” before India can replace China as a growth engine for the global economy, even if it grows at a faster rate.
He had also expressed concern over China’s yuan devaluation kicking off a currency war in the global economy.
More significantly, clamour for an urgent rate cut to propel economy has heightened after the GDP growth recorded a deceleration in the first quarter. RBI’s next monetary policy meeting is on 29 September.
In Modi’s first interaction with industry chambers on 30 June, the industry had raised the issue of high cost of capital, which they claimed is the reason for investment not picking up.
Though the RBI has cut rates by a cumulative 75 basis points this year, interest rates in the economy have not come down as NPA-ridden banks have been hesitant to pass on the benefit.
In all likelihood, this will again be one of the key talking points today at the meeting.
The economic reforms that have come to a stand still due to Parliament disruptions is the other major issue that will be taken up. In the run up to the Bihar elections, the government allowed an ordinance that eased land acquisition rules to lapse, which has left the industry disillusioned.
Apart from this, the government has not been able to solve the deadlock on the GST Bill in Parliament and also no major initiatives have been taken to ensure ease of doing business in the country.