CII believes that improving the investment climate in India, along with policy reform measures, could help add around 15 million jobs annually

Economic reforms since 1991 have transformed India into a fast-paced   economy that is rapidly raising incomes, plugging into global supply chains and developing a diversified and advanced industrial sector. India’s energetic entrepreneurs are key growth drivers, vibrant and dynamic participants in the national and global economies. Yet the country’s environment for doing business is rated poorly on most counts, and slow processes have muted the potential for growth.
If India is to quickly recover from its current phase of economic slowdown, it must boost investments and their efficiency. A central factor in this objective would be to streamline the ‘ease of doing business,’ a term that relates to the entire administrative and regulatory structure of a country’s investment scenario.
According to CII, improving the investment climate in India – along with policy reform measures – could help add as many as 15 million jobs annually. The investment climate in India is a complex mix of laws, policies and regulations introduced by the Central Government, State Governments, and regulatory agencies. The Ease of Doing Business parameters chiefly relate to administrative and procedural issues. If such procedures in the form of approvals and clearances are not timely and efficient, they can add to transaction costs of the economy, delay projects, discourage new enterprise and ultimately hamper the creation of new jobs. On the other hand, time-bound, clear and transparent procedural systems can streamline the business environment and attract much higher investments. Empirically, it has been found that those Indian States that offer better investment climates tend to attract more investments, both from domestic and overseas sources. Many States have evolved best practices across areas – the need is to collate such practices and adapt them among other States, to improve the investment climate across the country.

Read more at http://www.slideshare.net/ConfederationOfIndianIndustry/communique-may-2014-cover-story

CII Proposes 100-Day Agenda for New Government

Unveiling the CII action theme for the year as ‘Accelerating Growth, Creating Employment’, Mr Shriram noted, “With slowing growth and high inflation adversely impacting employment, CII will urge the nextGovernment to focus on reviving growth and generating new jobs.”

In his press conference, Mr Shriram added that CII has proposed a strong 100-day action agenda for the new governmentto boost growth. “A strong economic revival package and right implementation of policies by a fresh Government can help create as many as 150 million jobs in the next ten years,” he stressed. “Industry is looking for top policy steps such as introduction of GST, easing of interest rates by 100 bps, keeping subsidies at 1.7 per cent of GDP, and restructuring of labour laws to promote mass manufacturing.”

CII further stated thatwithcontinuing robust reforms, GDP growth could be taken back to the 8 per cent level in the next three years. “Amarket-friendly environment is required that would proactively promote investments, business and entrepreneurship,” said Mr Shriram. Mass manufacturing sectors and labour-intensive services sectors need to be encouraged, he continued.

Key priorities for CII in the coming year will be in the following ten areas: education, skills, economic growth, manufacturing sector growth, investments, ease of doing business, export competitiveness, legal and regulatory architecture, labour law reforms and entrepreneurship.

CII has strongly called for implementation of the following policies, among others, in the first 100 days by the next Government:

–          Introduction of GST

–          Containment of subsidies and fiscal consolidation

–          Monetary easing – reduction in the repo rate by 100 bps

–          Maintenance of a competitive exchange rate

–          Fast-tracking stalled projects and increasing public capital investments

–          Timely implementation of DMIC and NIMZs

–          Setting up of state level mechanisms similar to Project Monitoring Group which will review and monitor projects at state level

–          A strong inter- Ministerial co-ordination group to resolve sticky issues like mining, raw material securitisation for sectors like Steel, etc

–          An institutional mechanism to renegotiate the terms of concession in Public Private Partnership Contracts to salvage stranded investments

–          Expansion of e-governance & technology based initiatives to simplify processes and online monitoring of application forms

–          Time-bound approvals by introducing ‘deemed approvals’ in case of delays beyond prescribed limit

–          Restructuring labour laws including introduction of Fixed Term Employment for industry to hire manpower on short term assignments

CII would continue to provide inputs in the areas of direct and indirect taxes to help India emerge as an attractive destination for business.

In agriculture, CII’s Food and Agricultural Center of Excellence (FACE)is studying the impact of Agricultural Produce Marketing Committee Act (APMC) which needs to be revamped to delist perishables. CII will also undertake a study on gas pricing and its impact on end-users, macro-economic indicators and the investment environment.

In manufacturing, it will work with concerned Ministries and State Governments on delayed projects and also on specific policies, particularly for labour-intensive sectors. CII has called for quick implementation of the National Manufacturing Policy and would bring out a report on Mass Manufacturing policy.For MSMEs, CII plans to launch a Finance Facilitation Centre and initiatives to link Indian SMEs with global value chains.

In services, CII will constitute National Services Competitiveness Council and develop a sectoral strategy for doubling of services export by 2025. It has targeted several sectors such as Tourism and Hospitality, Financial Services, Telecommunications and Professional Services for export promotion.

For better quality higher education, one of the CII interventions will be to launch the 100-100 program where 100 CII member companies will create 100 Faculty Sabbaticals who will spend two/ three months in industry to explore multi-level partnerships like research, curriculum, and skills development. In skills, CII will help implement the National Skill Qualification Framework (NSQF) and continue to work on Sector Skills Councils.

In labour laws, CII will create platforms for sharing best practices from industry which have helped in fostering better industrial relations within the current framework. In addition, it will work with its membership, Trade Unions, Central and State Governments for creating consensus on various issues.

To improve the ease of doing business in India, CII will present to the government best practices in the states which can be emulated in the areas of land acquisition, contract enforcement and taxation. CII has been strongly underscoring the need for a reduction in transactions cost of exports to overcome difficult business conditions abroad. In this context, CII has constituted a task force on transactions costs which proposes a framework for building an efficient trade facilitation mechanism in India.

In order to support entrepreneurship, CII will significantly expand its PPP initiative “India Innovation Initiative” to select the most innovative entrepreneurs through a pan-India competition. 

NFAP Study on proposed Immigration Reform Bill

The National Foundation for American Policy (NFAP) recently released a new policy brief, ‘Senate Bill’s H-1B and L1 Visa Provisions are Reversal of Fortune for American Competitiveness’. The document can be downloaded here: http://www.nfap.com/pdf/NFAP%20Policy%20Brief%20H-1B%20and%20L-1%20Provisions%20in%20Senate%20Bill%20April%202013.pdf

In particular, the study highlights some of the components of the proposed Senate ‘Gang of Eight’ immigration reform bill which would impede American competitiveness in the long run and be detrimental to economic growth. In particular, the study focuses on:

1) New recruitment and non-displacement attestations

2) Hindering companies’ ability to deploy requisite high skill talent at client locations

3) Giving the Department of Labor unlimited investigative authority

4) Requiring much higher wage limits for foreigners, as against Americans

In addition, the study points out that some of the provisions may even place the US in violation of its commitments under the General Agreement on Trade in Services (GATS).

The NFAP is one of the few American organizations that has rallied behind the cause of free movement of skilled labor for many years now. Indian companies in the US could use much more of such support—given that the study is by a US organization, hopefully it will be considered by US lawmakers!