The exit polls for the Lok Sabha elections has enthused India Inc and there is a feeling that it will open the floodgates for the inflow of big-ticket investments. The opportunity to up it on domestic manufacturing is something that is being spoken of.
According to Hemendra Kothari, Chairman of DSP Investment Managers, there is a need for tens and thousands of skilled institutions. “The question is how do we all of this. There is a path for India to increase exports by positioning itself as a manufacturing base for large global companies,” he thinks.
For India Inc, policy continuity is the most critical element and normally, an incumbent government returning to power is viewed as a positive. Mahesh Singhi, Founder & MD, Singhi Advisors, an M&A advisory firm, thinks the exit poll numbers were on expected lines and the growth momentum for business can sustain from this point.
“The impact of any large decision taken now will be felt 5-10 years later. There will be a lot of confidence and comfort to invest in India now.”
Echoing the theory on domestic manufacturing taking off, Singhi terms it “inward-looking” in approach. “There is expected to be a lot of interest in areas such as defence, automobiles and anything to do with overall consumption. If that can be done on the back of the continued large investments in infrastructure, there will be a lot of optimism,” he explains. At the core of everything is a regime marked by steady policy. Kothari says that aspect is extremely critical in infrastructure, an area where the government has consistently increased its outlay.
“There is no doubt India will do well and we are a shining example to the rest of the world. However, we will need to continue the focus on skilling and that is where something like AI can be of great help.”
Clearly, more of the same is never a bad idea and Singhi maintains it is really about having a policy framework that is clean. “There was a perception that nothing could be done with our railway infrastructure but something like Vande Bharat has changed that,” he says. To him, the digital economy and its growth augurs well in the time to come.
“Confidence levels among the corporates will increase if policies are clear. As a nation, we must ensure that it should not be broken only to ensure continuity.”
The pertinent question is what the next round of a Modi government means for the nation. Deven R. Choksey, Chairman and MD of wealth management and investment advisory firm DRChoksey Finserv, points out that the unobstructed functioning of the parliament is expected to deliver many progressive reforms in India. “Economically, India will grow much faster now. This will be on the back of the bright prospect of reforms like central bank digital currency (CBDC), open network for digital commerce (ONDC) and de-dollarisation of payments for global trade by India.” From a markets point of view, while there is expected to be excitement, there could be a larger takeaway. “Reforms will produce predictable earnings growth for India Inc. We are likely to attract premium dollars in the journey to becoming a $12 trillion economy by 2035,” says Choksey.