Slowdown Cyclic In Nature, Right Time To Invest In India, Says Piyush Goyal
The recent economic slowdown in India is a cyclic structural adjustment, this is the right time to invest in the country before growth bounces back, Commerce Minister Piyush Goyal said on Tuesday.
Admitting thaty India’s GDP growth has slowed in the past two quarters (January-March and April-June, 2019) to a six-year low of 5 percent, Goyal said that India is no longer the fastest-growing major economy.
"India, being an economy with huge opportunities, could do well without this kind of a slowdown. Our economy is like any other economy in the world...challenges have grown (in recent times)," Goyal said at the India Energy Forum in New Delhi. "We had a pretty good run for almost 4-5 years before the last two quarters. It (the slowdown) is rightsizing of certain sectors or opportunities in different areas."
"I see the slowdown, but I don't get unduly perturbed by it. It is an opportunity for all of us to reassess capacities, productivity and costs of production,” said the commerce minister.
Asserting that this is the right to time invest in the country, Goyal urged investors to direct their funds into India, before the growth in the economy picks up again.
On the government's efforts to boost economic growth, he said that in the past five years, India saw investments that were worth two-and-a-half times of the previous five years.
Speaking on plans for various sectors of the economy, Goyal said Indian Railways would focus on a $700 billion-investment programme over the next 12 years to become an engine of growth as well as bring down logistics cost, which would impact all industries in the country.
Similarly, the infrastructure sector will see an investment of $1.4 trillion over the next five years, which will certainly drive growth and bring back the mojo to the industry, the commerce minister said.
Goyal believes that, going forward, the energy sector has a big role to play, with a $60-70-dollar investment potential in India. "If energy becomes the viable proposition, then the chemical and petrochemical sector, together, can truly drive back growth into the economy. My own sense is that the energy sector is at the cusp of a revolution in the country.”
India is willing to engage with modern technology and is looking at efficiency in domestic production—particularly in gas, he said.
On renewable energy, Goyal said Prime Minister Narendra Modi has dropped the bombshell of 450 GW of renewable energy target—solar, nuclear, wind and gas (in some sense).
On the foreign direct investment, he said that India has opened up the platform to almost all sectors, except to a few which are security or national policy concerns.
In the energy sector, 100 percent FDI is allowed.
On tax rates and ease of doing business in India, Goyal said: "Our income tax rates are aligned with all comparable economies. India provides single-window service without opening doors behind the window, which has been experience in the past."