Fixing The Fisc

Prime Minister Narendra Modi has indicated that tough measures will be needed to get the Indian economy back on track. And, as a consequence, there will be hardship in the short term. BW spoke to a cross-section of opinion makers to get a lowdown on the pain points

“Rationalise subsidies on food, fuel and fertilisers; privatise loss-making PSUs, and expedite the implementation of GST to raise revenue. Also, tame food inflation by announcing measures for private sector engagement in storage and movement of agricultural products.”
— Naina Lal Kidwai,  Director, HSBC Asia Pacific and Chairman, India

“The fiscal deficit has to be controlled and the current account deficit should not be more than 2 per cent under any circumstances. Measures need to be taken for inflation control. ”
— Venugopal N. Dhoot, CMD, Videocon Industries

“Power distribution companies need to be financially viable. For this, a mandatory annual increase in power tariffs is necessary.”
— KameswarA Rao, Leader, Energy, Utilities and Mining, PwC
 

“The toughest moves by the government would be phasing out of subsidies and downsizing NREGA. The government could save nearly Rs 4 lakh crore by withdrawing subsidies. For generating revenue, the government needs to widen the scope of advance tax to even luxury products, cars and property.”
— Subba Rao Amarthaluru, Group CFO, RPG Group

“Limit coverage of NREGA and food Act. Cut petroleum subsidy as it is a rich man’s subsidy. Otherwise, raise more money through disinvestment.”
— Abheek Barua,  Chief Economist, HDFC Bank

“Curb subsidies on fuel, deregulate diesel, relax rigid labour laws, implement nationwide GST in a time-bound manner, simplify land acquisition process in order to resume infrastructure projects and remove retrospective tax amendments.”
— Brijesh Mehra, Managing Director and Head, International Banking, India & South-east Asia, RBS

“Streamline subsidies and take a long hard look at centrally sponsored schemes to cut expenditure. Options in what may be a drought year are limited.”
— Pronab Sen, Country Director, IGC India Central Programme



(This story was published in BW | Businessworld Issue Dated 14-07-2014)