MODI CASTS SPELL INCAPITAL.
Favours Goods and Services Tax as gamechanger Signals shift in favour of big retail business
IT WAS Modinomics all the way in the Capital on Thursday. Bharatiya Janata Party ( BJP) prime ministerial candidate Narendra Modi revealed two major economic mantras-- acceptability of modern retail and a commitment to a nationwide Goods and Service Tax-- as he spent the day interacting with traders, chartered accountants, business heavyweights and diplomats in a series of meetings ( graphic inside).
The first major takeaway from Modi's day out was that the BJP seems no longer opposed to foreign investment in multi- brand and online retail. Speaking to traders from across the country under the banner of Confederation of All India Traders before noon, Modi asked the trading community not to run away from global challenges but adapt itself to modern practices like tying up with bigger stores and online trading.
BJP leaders have been of the view that FDI in retail is a threat to millions of grocery stores and traders who are a backbone of the party's support.
Without referring to foreign direct investment in retail, which his party is strongly opposed to, Modi said that the millions of small traders in India must learn to work with large modern stores. " I don't know it will benefit me politically... Trading community should not run away from global challenges. They should not think they will die if businesses go online... You demand from government help to build your capacity to meet challenges... A small town buyer is also looking for branded products. We should not meet to decide how to escape from this but how to take it on. You should enhance your quality and filter out those whose quality is suspect," he said. Modi went on to talk about a total revamp of the system in the country, claiming that Congress- led UPA government had executed a ' kaya kalp', or time reversal, pushing the Indian economy back by a decade.
Online shift Advocating online retail, Modi said: " People even in rural areas are now looking for branded stuff. Small businessmen can do big business by setting up virtual units, and take a leap. They can improve the delivery systems and go for online marketing. They can set up virtual malls." We don't have to fear global challenges. We can, in fact, convert this into an opportunity and out- run our global rivals... Our traders have higher risk- taking capacity than soldiers," he added. Modi said governments had made a web of laws in the last 60 years and should be to empower people of the country rather than distance itself from them. " I think that there should be one law in place of 10 laws," Modi added.
Speaking in favour of GST, first at the CAIT meeting and then while addressing chartered accountants later the afternoon, Modi said, " I want to make it clear that BJP is in favour of GST," adding that without proper infrastructure it would be difficult to implement.
GST is a long- planned reform to create a uniform market, cut business costs and boost government revenue.
State governments, including Modi's Gujarat, have resisted GST, fearing that they would lose revenue if the current array of levies is replaced.
Slamming the UPA government, he said that running coalition cannot be blamed for policy paralysis. He said that the party should not blame alliances for its own failures and quoted the example of Atal Bihari Vajpayee, saying that the former prime minister led a coalition and minority government successfully.
Talking about PSUs, Modi said, " There is a general concept that PSUs are born to fail or get sold, but we thought differently and that is to professionalise those institutions." He emphasised cordial
relations between Centre and states.
Speaking at the India Economic convention 2014, Modi offered business bigwigs, global investors peek into his economic vision, saying what the country needs the most is strong leadership. Saying that vision is important, Modi said that what was crucial is the " execution ability and the strength to take stern decisions and bring about change." " India is the only country in the world that has as its biggest strength, its democracy, demography and demand. However, what is lacking currently is direction, determination and dedication. We need good governance, for bad governance is like diabetes which invites all kinds of ills," Modi said.
" During Atalji's regime, the country was on the right track and was
witnessing a growth rate of 8.4 per cent. We are now looking at a growth rate of 4.8 per cent. We are only suffering from fiscal deficit also from governance deficit, trust deficit, security deficit and moral deficit. It is thus, natural for people to feel dejected. The country thus needs a paradigm shift. If leader can instill confidence, things will change for the better soon," Modi said.
Taking a dig at Prime Minister Manmohan Singh and the UPA government, Modi said that even municipal bodies across India took more decisive policy decisions than the current government. He went on to illustrate how he has tried to do things in Gujarat and how the new government must approach problems.
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