ETMGS: Go local to realise $5 trillion economy, say D-Street experts

Mumbai: Going local may be the key that could remove the hurdles and chart the path for India to reach its target of $5 trillion economy, say industry stalwarts.

Narendra Modi government soon after assuming office for the second term had set a target of taking the economy to $5 trillion over the next five years.

While speaking at ETMarkets Global Summit in Mumbai on Friday, Nilesh Shah, Managing Director of Kotak Mahindra Asset Management said that India had the third-largest reserves of coal, but yet it imported the fuel.

He also pointed out the irony of Indians spending far more money to travel overseas for holidays instead of opting for Indian destinations.

“The day Indians realise ‘Be Indian, Buy Indian’, most problems will be solved,” said Shah.

Vaibhav Sanghavi, Co-CEO of Avendus Capital said the Indian economy was in a transit period as far as conducting business was concerned.

“You need to give money to public for formalisation of the economy. You cannot just work on the supply side, you also need to work on the demand side,” he asserted.

Radhika Rao, Senior Vice President and Economist at DBS Bank pointed out that much of the consumption argument was focused in tier-I and tier –II cities, and that needed to change.

Expressing his concerns, Salil Pitale, JMD & Co-CEO of Axis Capital said: “There was an imbalance of labour and GDP contribution. Agriculture, which employs most, has low contribution to the GDP.”

“We need services and industry to go deeper into Bharat. We need to bring better quality of life to villages,” argued Pitale.

Panelists at the event were in agreement that deadlines can be a big motivator

Nilesh Shah, citing an example said that CommonWealth Games in New Delhi -- which was held in 2010 -- led to a massive infrastructure development in the capital city. “If there is a time-bound delivery, we as a nation will figure out a way,” said Shah.

“If $5 trillion is Mr Modi’s target, it is difficult. But, if it is yours and mine, then will get there by 2025,” the industry expert said.

Emphasising that there was a need to understand that there is a huge amount of skill development to elevate everyone, Vaibhav Sanghavi said that this can bridge the gap between rural and urban India.

Sanjay Sachdev, Chairman of Zyfin Holdings believed that it would not be any one industry, but a host of them along with innovation and technology that would be key to drive India on its growth path.