Dear Member, It's been more than a year I took over as President ASSOCHAM and I am happy to say that it was indeed an honour to lead the Chamber, considered as Knowledge architect of Corporate India; it would be completing its 100years of establishment in India in 2020. While this is an emotional moment for me to write this last message in ASSOCHAM BULLETIN as President- ASSOCHAM, I must say that this journey was truly enriching in terms of meeting many politicians, successful business leaders and opinion leaders of the civil society, and they all agree that only through cooperation between the three main sectors of the society (government, business and civil society) we can create sustainable solutions for any issue related to growth of our nation. This is why ASSOCHAM will be the organisation that unites all sectors of the society to create sustainable impact.
The year 2017 is considered as the year of economic reforms. The year began with repercussions of one of the bold move of demonetization, taken by our Hon'ble Prime Minister Mr. Narendra Modi, followed by roll out of GST from 1st July, 2017. Moreover, implementation of Insolvency & Bankruptcy Law 2016 & RERA were effectively done during 2017, which has created another challenging scenario for the Indian economy.
There will always be head winds and tail winds, but the destination has to be achieved by a consistent economic growth which is upward of 8,9 and even 10 per cent year after year. What we are witnessing now in the form of rising value of dollar, increasing crude oil prices, global trade war, volatility in the stock markets and repairing of the twin balance sheet problem of the banks and corporates should only pass off as temporary blips. The government with the help of the Reserve Bank of India (RBI) and the states is already on the job to ensure that no systemic issues crop up and even if they do; they are addressed without any disruption to the system. There is a fair amount of optimism, even when there are global head winds. According to the latest IMF projections, our growth rate would be 7.3 per cent this year and 7.4 per cent in 2019 even as India would regain the title of the fastest growing economy of the world.
Industrial production in the country expanded at a five-month high in June with all three major sectors - manufacturing, mining and electricity - contributing to the recovery. Growth as measured by the Index of Industrial Production (lIP) stood at 7% in June compared with 3.9% in May, according to data released by the statistics office recently. The data is line with an economic revival narrative, although some experts said more data was needed to confirm a trend. The lIP number benefited from the base effect of 0.3% contraction in June last year.
The Reserve Bank of India has sprung a positive surprise on India Inc, keeping the lending rates unchanged at 6.5 per cent. The Monetary Policy Committee, by a majority decision, has rightly given a reprieve to the borrowers even amidst global headwinds, particularly continuous pressure on the crude oil prices, weakening rupee and attraction of the USeconomy for the global investing community. The fact that the MPC did a realistic assessment of the 'substantial risks to growth and inflation outlook' from global head winds and decided to read an 'imperative' situation to 'further strengthen domestic macro-economic fundamentals is laudable.
The ASSOCHAM expressed the hope that the RBIwould keep a vigil on the challenges of the liquidity position through its interventions in the form of Open Market Operations (OMOs) so that the cost of money remains in check and interest rates do not add to the cost pressure.
Above all, I would like to convey my sincere thanks to the ministers, bureaucrats, my fellow members & colleagues at ASSOCHAM for their whole hearted support to make my tenure a fruitful one.