India Inc says yeh dil maange more

Mumbai: “I am a Gujarati and business is in my blood,” Prime Minister Narendra Modi told his Japanese hosts. So India Inc can take heart and many of the hurdles in the way of doing business could be removed. Of course, India Inc has to be positive and also give solutions and not only complain as finance Arun Jaitley said sometime ago.

The stock markets are booming with the Sensex crossing 27,000 as the Modi government completes 100 days in office. Investor confidence has returned and this is evident in the inflow of funds by FIIs, who pumped in net equity in 2014 (as of August 25, 2014) of $12.81 billion ($11.58 billion in 2013) and $16.67 billion ($5.6 billion) in debt. Mr Modi definitely changed the sentiment at India Inc’s level and has told the world that India is once again open for business!

Several foreign companies are showing their eagerness to come to India and invest and have been particularly enthused by Mr Modi’s “Make in India” call in his Independence Day speech.

The raising of the caps on FDI in defence and the railways has been welcomed and a large number of projects have been cleared. But several projects were also cleared in the last government’s dying days. Like those projects, the clearance of projects  by the Modi regime too have yet to take off. Investment has yet to come so that the projects can be started or completed.

The government will have to match its intentions with decisions that facilitate the ease of doing business. It has taken a few steps like speeding up decision making, setting up a mechanism to settle tax disputes, but much more needs to be done.

The states have yet to get the message as they play a significant role in the ease of doing business. They provide the land, water, power, electricity connection,  and other things needed to start a business.

Corruption is still a major issue; though it may have been curbed to a large extent at the Centre with Mr Modi keeping a watchful eye on the bureaucracy and his ministers. But what about the states?

Mr Modi has taken steps to cut down on the inspector raj. But a lot needs to be done and the power cuts in Mumbai and north India are some of the challenges that Mr Modi has yet to grapple with.