Hope is back in business

India Today
8 June 2009

Aditya Birla Group Chairman, Mr. Kumar Mangalam Birla in an interview with India Today.
Is the rise in markets and faint glimmer of feel good factor for real or an illusion?
Stock markets have already expressed euphoria about the election results. In a sense there may be a correction in the earlier over-pessimism. I think market sentiment reflects the confidence of investors in policy makers to guide India back towards high growth.

Can we say the worst is over for India?
Definitely. Things appear to be bottoming out for cyclically driven industries like automobiles. Export-driven sectors may need more time to get out of the woods.

Can the revival of growth in India be decoupled from global horror stories?

India's growth is mainly driven by domestic consumption coupled with structural factors like demography and productivity improvement, so it is not as pained as other economies.

When do you expect the Indian economy to turn around?

My sense is that this will happen in another two to three quarters.

Are there any signs you would watch out for to signal the return of growth?

The key signal to watch is a shift in confidence levels, not only among investors but also among consumers and businesses.The "purchasing managers' index" reveals that things are moving in the right direction.

Three steps the government must take

• Rev up spending on infrastructure — it c;reates public goods, jobs and provides a handsome return on fiscal spending.
• Focus on education, go beyond NREGA to teach people sustainable livelihood.
• Push reforms and disinvestment.