This refers to “India Inc’s long winter” (November 14). While there is progress in ease of doing business, India Inc has not been able to deliver results as expected by the market, which is negatively impacting the market capitalisation of many corporates. This signals that the country is not a better destination for investment than before. Rural consumption is one of the crucial factors to boost demand; however, it is not growing much owing to the sluggish rise in the real income of the farming community. The inflationary tendency in the economy must be kept under control to boost consumption. Consumption, demand and investment have to rise to ensure dynamism in all sectors of the economy.
Apart from that, the inadequacy of capital and affordable institutional credit is dragging the performance of many corporates. The rigid loan default and resolution norms imposed on the power sector and the prompt corrective action on the banks by the regulator are inimical to growth of industrial and commercial activities. Some relaxations in the norms are essential to revive the sector which is lying on the bed awaiting suitable treatment.
Kesava Pillai
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