It gives me great pleasure to interact with you all, through this digital forum, on the occasion of the 93rd Annual Convention of FICCI. In more than nine decades of its existence FICCI has played a pivotal role in addressing the issues concerning Indian Industry and Business in the most constructive manner. It has played a very important role in India’s emergence as one of the most rapidly growing global economies.
Friends, the COVID-19 pandemic may have constrained our ability to meet in person; however, it has afforded us the flexibility of time, distance and virtual interaction. Such a format facilitates a more inclusive dialogue, with saving in time and resources. In that sense, this adaptation represents the very essence of converting challenges into opportunities – of transforming distance into proximity, and seeking inspiration from momentary setbacks. The pandemic is a massive challenge which has shaken up the whole world. It has impacted almost every aspect of our daily lives and the set-back to global economy is also immense. At the same time, the pandemic has also inspired and pushed the boundaries of human ingenuity.
Friends, I don’t think there could have been a more apt theme for this year’s Convention. The beginning of the year 2020 was unfortunate for the entire world. The outbreak of coronavirus epidemic brought with itself a great amount of uncertainty. India too was greatly impacted by it. It was a serious challenge for a nation like India that was making a quick stride towards attaining its right place in the comity of nations.
Stopping, halting or moving back was not an option for us. But human life was the most precious for us. The option was never between to save “Lives” or to save “Livelihoods”. We knew our utmost priority was first to save lives. We knew that at no cost we could risk the lives of millions; hence India became one of the first few nations to impose a countrywide lockdown that continued for weeks. We knew it is going to be hard. But we were certain that we would bounce back. And, here what we call “Inspired India” played the most important role.
The “Inspired India” that believes in our innate capacity to find opportunity among adversity. The “Inspired India” that was not ready to give up. The “Inspired India” that constitute of our Medical Fraternity who made every possible effort to minimise loss of lives. The “Inspired India” that constitute of you— the esteemed members of Business and Industry who made every possible effort to minimise loss of livelihoods.
The “Inspired India” that constitute of Innovators and Enterprising Youth who worked tirelessly to minimise loss of opportunities. The “Inspired India” constitutes of institutions like Election Commission that managed to conduct a free, fair and peaceful election” with 7.79 crore voters in such a challenging time.
The “Inspired India” that constitute of our armed forces, whom no virus could deter from their duty. While the world was fighting the deadly virus, they were valiantly defending our borders. And, above all the “Inspired India” that constitute millions of common men and women who showed great patience and resilience in this fight against coronavirus. Today, India is back on track, with new vigour.
In our fight against Covid-19, an inspired India with all Indians participated together as a nation. The role of citizens in successful implementation of the lockdown in order to contain the initial spread of the virus was no mean achievement.
Voluntary organisations came forward to provide food, medicines and essential supplies in lockdown, Civil Societies contributed by taking care of the needy and individuals stood by each other many a times organizing tiffin services for migrants.
The devotion to duty showed by our front-line covid warriors including doctors, healthcare workers, ASHAs, sanitation staff etc. earned the adulation of the entire nation.
The government acknowledged this indomitable spirit of the entire nation. In order to pay respect and bind the entire nation with this spirit, innovative measures like clapping and beating thalis, lighting of diyas were encouraged by our PM.
Our defence forces also expressed their gratitude to corona warriors, including healthcare workers, police, and forces who were at the forefront of the battle against the pandemic through flypasts, lit-up ships and musical tributes outside hospitals across the country. I still remember the time when serious doubts were raised regarding our ability to provide basic support facilities – from masks to PPE kits, ventilators and ICU beds.
We have witnessed how different companies rose to the challenge to manufacture healthcare products like mask, PPE kits, sanitizer, ventilators and ICU beds at the start of the pandemic.
I congratulate our entrepreneurs who showed courage. They took a leap of faith in adapting and adjusting their production lines. That, truly, reflects the sentiment expressed by Gandhiji, about companies acting as trusteeships, valuing social responsibility alongside profits.
This pandemic has also proven that India has always been futuristic and has believed in finding permanent solutions to the problems. World over, there have been serious and sincere efforts to make a COVID-19 vaccine as early as possible.
India too made a quick development in this regard. Today, after only 10 months, vaccines are in their final stage of development, to be produced in India. But an important question was what if tomorrow a new virus outbreak happens. Can we afford yet another coronavirus like epidemic? The answer to this uncertainty is to create a defensive mechanism that can fight any virus. The answer is to strengthen our immune system.
Friends, It is heartening to note, India has walked toe to toe with its global peers, helping people across the globe. Besides helping itself to recover from the crisis, this nation also helped many other countries of the world to recover. Whether it is evacuation, or supply of medicines, or any other kind of help, India is taking everyone along. That is, India has been inspired by itself, and has also inspired others to help them get revived. There is the self-inspiration of India, which has been embedded in us for centuries in the form of ‘संगच्छध्वं, संवदध्वं’, i.e. ‘May we all go together, let us all move together’.
Friends, this government is action-driven and believes in tackling the problem head-on. Right from the start, our government has taken various steps to mitigate the adverse impacts of COVID-19 pandemic. The financial packages that the government has released have had wide ranging and far-reaching impact. Commencing with the initiative on 26 March 2020, a Rs. 1.7 lakh crore package was announced which focussed on providing immediate relief to the poor, migrants and both urban and rural workers. It included food security and direct cash transfer. In May this year, a follow up 20 lakh crore package addressed a number of challenges faced by the country. The focus of this initiative also aimed to provide a major impetus to the Atmanirbhar Bharat initiative.
As you are aware, it included collateral free loans, relief for salaried tax payers, workers and other stressed businesses. Government contracts up to Rs. 200 crores were limited to only domestic firms.
Nearly 81 lakh MSMEs have taken advantage of Prime Minister Narendra Modi’s Emergency Credit Line Guarantee Scheme (ECLGS) under the AtmaNirbharBharat package. While, special attention was given to MSME Sector, as they needed extra support, at the same time several important policy decisions were also taken to incentivise big businesses.
Soon after the nationwide lockdown, which ought to have a negative impact on the economy, the doomsayers started making prophecies of doom. It was said that it would take more than one or two years for India to reverse the 23.9 percent contraction in our Gross Domestic Product (GDP) that we witnessed in the first quarter of this financial year. But, once again they were proved wrong. India bounced back in no time. In the second quarter, the Indian economy registered a 7.5 per cent contraction in its Gross Domestic Product (GDP). It was a significant improvement over the 23.9 per cent contraction that we witnessed in the first quarter. The manufacturing sector which registered a 39.3 percent contraction in first-quarter registered a 0.6 per cent growth in the second quarter. This forced The Asian Development Bank (ADB) to change its forecast for the Indian economy, projecting 8 per cent contraction in 2020-21 as compared to 9 percent degrowth estimated earlier.
Agriculture and allied sectors also grew. Electricity, gas and other services posted a 4.4 per cent growth as against a 7 per cent contraction in the previous quarter. This is a clear indication that India’s economy is likely to return to pre-Covid-19 levels by the end of the current fiscal year, which is much earlier than expected.
It is the strength of our economy only that India, in April-August 2020, received the highest ever total Foreign Direct Investment (FDI). The total FDI inflow into India in the first five months was $35.73 billion, 13% higher than that in the same period last fiscal. Our focus on infrastructure building and improvement has not diminished and we see it as a great multiplier in terms of employment.
A word here about the agricultural sector here, for it is the mother sector for all others. Agriculture has been one sector which has been able to avoid the adverse effects of the pandemic and, in fact, come out the best. Our produce and procurement have been plentiful and our warehouses are full.
There is no question of taking retrograde steps against our agricultural sector ever. The recent reforms have been undertaken with the best interests of India’s farmers in mind.
We are, however, always willing to listen to our farmer brothers, alley their misgivings and provide them with assurances we can provide. Our Government is always open to discussion and dialogue.
On the global front, friends, the undermining of global supply chains has created an opportunity to strike a balance between Atmanirbharta and globalisation. I think the launch of ‘Aatma Nirbhar Bharat Abhiyaan’ is a “Watershed” moment in the economic history of India. Under the AatmaNirbhar Bharat Abhiyaan several policy decisions have been taken that will provide new “Energy and Enthusiasm” to Industry and Business in the country.
All of this has been made possible by the help of “Inspired India” which is guided and motivated by the bold and decisive leadership of Prime Minister Shri Narendra Modi and timely policy interventions by the government.
I firmly believe that in the time of crisis of this scale, it requires a rare leadership to bring people together. While our Prime Minister, not just like the head of the government, but like the head of a family, led the way for all of us, it was leaders from every field who too showed the way.
Friends, today we are at the cusp of a major change. The post-corona world is not going to be same. The challenges are going to big and we will need grit and determination to deal with it. We will need the inspiration to deal with this new world order.
We have to strike the right balance in our efforts to stimulate economic growth, prevent supply chains disruptions and create new resilient supply chains. India is working with countries such as Japan and Australia in the context of resilient supply chains, especially in semi-conductors, chips and so on.
India can be a great alternative to others because it offers a full spectrum of capabilities and opportunities to foreign investors and partners. India has the potential to emerge as a hub for manufacturing of healthcare products. Labour cost arbitrage is a dream that can still be chased by global manufacturing companies in India.
We should catch the next wave for lowering global manufacturing costs. The Labour code Bill 2020 is also our commitment to increase ease of doing business. I would urge the business community attending this seminar to look into the ways and means to ensure that India becomes a global manufacture hub soon.
We need to take more fulsome advantage of the global shift in outsourcing of manufacturing to Asia, but to do this; we must scale up our skills as well.
Amongst several sectors of the economy which are set to contribute towards our Atmanirbhar Bharat Initiative and to the revival of growth, I believe the Defence sector would play a significant role.
Allow me to take this further and state in no uncertain terms that this is the approach we are trying to bring to the defence sector.
It’s not a very comforting fact that as one of the largest armed forces of the world, we are so import-dependent in critical areas. While we have made some important strides in defence production, a lot more can and must be done.
The unprovoked aggression on our Himalayan frontiers is a reminder of how the world is changing, how existing agreements are being challenged, how power is being asserted not just in the Himalayas but across the Indo-Pacific. And how uncertain the future of the region and world could be in this backdrop.
As you are aware, there is big build-up of Armed Forces at the LAC in Ladakh.
In these testing times our forces have shown exemplary courage and remarkable fortitude. They fought the PLA with utmost bravery and forced them to go back. The coming generations of this nation will be proud of what our forces have managed to achieve this year. Whenever there is a situation at the LAC, the most obvious outcome is a comparison between India and China’s military strength. But I don’t want to dwell on that.
There can be a serious debate on who owns more military might but when it comes to soft power there is no scope of ambiguity. India is far ahead of China when it comes to leading the world with ideas. If you look at entire East Asia from Burma to Thailand to Indonesia and Malaysia even Japan, there is a huge Indian cultural impact on all these countries. Buddhism had a monumental influence over China to an extent that before the 1949 revolution almost 80% of China’s population followed Buddhism.
I would like to quote the famous Chinese thinker Hu Shi, who rightly said “India has culturally dominated and controlled China for more than 2000 years without sending a single soldier across the border”. This statement by Hu Shi underlines the fact that India as a civilisational state has been inspiring and influencing the world through its culture and soft power for centuries.
Friends, India, due to its location, size, population and economy, has always been at the strategic forefront of global security.
We have been victims of cross-border terrorism, yet have fought the scourge alone even when there was no one to support us but later, they understood we were right about Pakistan being the fountainhead of terrorism. And now again our brave forces are there in the forefront fighting icy winds to guard our borders and to fulfill their responsibility. The question is can our industry also stand shoulder to shoulder with our forces? Can we use our economic strength to our advantage, forge the right partnerships, bring the right technology for our armed forces? Can we be at the forefront of military production – lethal or non-lethal – like our soldiers on the border? Today’s India is different from 1950s or 1960s. Our businesses, people like all of you, are champions in your sectors. You have the confidence — that has come from great success in India and overseas – as well as the global reach to influence decisions. I urge you to please study our policy shifts in defence more carefully and organize your businesses accordingly.
We have opened doors to the private sector, incentivized domestic production, are creating defence corridors and doing a lot more. We are also willing to engage in meaningful joint ventures and partnerships with other countries. We want to make defence equipment in India for the world. So, it’s time industry examines this opportunity with both pride and priority.
But I am here to also make another point. There comes a point in a nation’s history, every now and then, when it needs to stand up for itself, tell that it can fight anyone, that it’s capable to take any challenge, just to survive.
However, victorious is the country which not only rises to the challenge but turns it into an opportunity, changes the way things are and creates a new reality of prosperity, security and peace. That’s what we need to do in the defence sector. And that’s also is the essence of atmanirbharta. In other words, Ek Atmanirbhar bharat se hi hai surakshit aur samradh bharat.
Defence has huge implications for India’s endeavours to promote R & D, innovation and its efforts to secure a place in global supply chains. Of particular relevance is the fact that whatever we achieve together in the defence sector has enormous spin-off benefits for the economy in general. Towards this objective, various initiatives have been taken in the defence sector recently. The newly introduced Defence Acquisition Procedure 2020 along with our earlier decision to increase FDI in defence through the automatic route to 74 per cent will provide an impetus to domestic manufacturing and development with the induction of newer technologies and global best practices.
A negative import list of 101 items has been released to give a boost to domestic manufacturing. This will especially provide an opportunity to the private sector to enter into the defence manufacturing space. Our Defence Production and Export Promotion Policy 2020 (DPEPP 2020) provides the necessary guidelines to provide an impetus to defence production and exports.
I have no doubt that the private sector will remain an active participant in achieving the turnover of Rs 1,75,000 Crores and exports of Rs 35,000 crore.
We have not only renewed our focus on Research and Development, but also made the facilities, labs and patents of DRDO available for use in the private sector to encourage defence production. As part of our policy, there is special emphasis on supporting and encouraging MSMEs to become a part of global defence value chains. This means that they need support for upstream and downstream integration, with raw material supply chains and markets. Their products need to be qualitatively competitive, not just in terms of price. Our industry associations have a big role and responsibility in this regard.
Friends, for a large country like India, one of our primary objectives is to create employment for the 12 million people who enter the labour force every year. I want to use this platform and urge our luminaries of the corporate world to create more jobs for our youth to further their indomitable spirit.
There is no doubt that together we will succeed in making not only a better India, but a better world. Let us join hands to work for a better future.
At the end, I would like to congratulate Dr Sangita Reddy, President of Federation of Indian Chambers of Commerce & Industries (FICC) and everyone associated with this esteemed organisation for continuing with the rich tradition of holding this Annual Convention where “Thought Leaders” share their ideas and perspectives that help the government to form policies that are in the best interest of the Industry and the Nation and the Society.