By Sanjoy Chakraborty
India is currently experiencing, undoubtedly, the most dreadful economic crisis since its Independence. Almost all the major economic forecasters of the world, starting from the World Bank to Goldman Sachs to Fitch to McKinsey and many others have raised alarms about a confirmed significant contraction of India’s GDP for financial year 2020-21 (FY21).
The economic contraction projected ranges from 4% to as high as 14%. Further, negative modifications in these projections are emerging every month, making India’s economic climate a stifling one for investors, bankers, suppliers, dealers and perhaps for everyone in the economic value chain.
At this juncture, we have two options left with us. Either we sit back quietly within the comforts of our home and immerse in self-pity against the backdrop of the brutal onslaught of the COVID-19 pandemic, which is destroying our present and tearing down our future. Or we get on with the other option: rise like a Phoenix from the ashes. If India has to again achieve a GDP growth rate of 8-8.5% per year and to create 90 million (nine crore) non-farm jobs over the next decade then we need to do a few basic things in a few basic ways right now:
- Focus on infrastructure and construction: Accelerate growth and not stop at announcement and planning stages. Just go, execute it and build trust so that it creates a ripple effect which flows from infrastructure and construction to the industries and back – creating a virtuous cycle.
- Focus on manufacturing: Come up with solid executable policies both for domestic and foreign investors, removing all the intermediaries which act as impediments to investments and growth. Set targets and deliver, make it fast-track on the ground and not on the policy papers.
- Focus on services sector: A deeper focus on the services sector with a special eye on the “digital system” is the need of the hour. Only catering to the derived demand of the western countries will make India vulnerable to the unforeseen external and involuntary shocks. We need to focus on building and developing the services sector which, in turn, can provide the right impetus to the domestic industries and consumers. Innovative ideas need to be germinated, groomed and executed.
- Focus on developing skill-sets: India needs to revamp and overhaul its entire skill development planning, which includes the entire academic orientation in schools, colleges and professional institutions if they want to be at par with the best-in-class of the world. Indians need to be made job-ready rather than mere degree holders. The above things are pretty do-able and achievable provided we have the right intent. Remember, it was India, which did grow at 7-8% over the years 2000 to 2009 during the information technology boom and the employment growth rate was 1.3%. India has done it before and if we take the right set of steps then we can do it again.
Sanjoy Chakraborty is Senior Manager, Marketing & Business Development, MSPL Ltd. He is a management professional with 14 years of experience in the iron & steel sector, spanning domains like marketing & sales, corporate strategy, strategic sourcing, market intelligence and business economics.