Power Politics - independent voice for public good

Current Issue: July 2009

‘P M Should Deliver A Weekly Economic Broadcast’

With an almost clear mandate accorded to the Congress-led United Progressive Alliance government in the 15th parliamentary election in India, there are high expectations of it among corporate leaders as well as economic experts. Most of the industrialists have expressed a sigh of relief and felt that the new Manmohan Singh government would no longer have to depend on small, parochial parties, the Left in particular, for its survival and hence could speed up the needed reforms in sectors such as of pension, insurance banking, education, retail and labour. There is a near consensus across the Indian economic spectrum today that the government should now focus on sustaining high economic growth crucial for alleviating poverty and fostering development. It should

also improve public education and rejuvenate Indian agriculture. Power Politics has interviewed Charles H. Kellstadt Professor of Marketing at the Goizueta Business School of Emory University Jagdish N. Sheth to ascertain his mind on the matter. Prof Sheth is an internationally recognized business consultant whose clients include AT&T, BellSouth, Ford, GE, Motorola, Square D, Whirlpool and Sprint. He is also the founder of the Center for Telecommunications Management, University of Southern California, and the famous India, China & America Institute.

Excerpts:

Power Politics: Prime Minister Manmohan Singh's government has got an almost clear mandate this time in India's parliamentary election. What are your expectations from New Delhi?

Prof Jagdish N Sheth:I expect three things from New Delhi. First, appoint the right set of ministers who can deliver on promised vision and mission for the nation. The key areas are education, health care and security. Second, focus on Direct Foreign Investment (FDI) into India by developing investor friendly culture and processes. The best role models are Singapore, Hong Kong and the US. Third, have a weekly broadcast from the Prime Minister as a leader of the nation. This is similar to what the US President does each week.

Power Politics: According to an authentic study, the world's advanced economies will contract by a record (-) 3.8% in 2009, Japan and Germany 6.2% and 5.5% respectively, the UK and the Euro area 4.1 and 4.2% and US 2.8%. America which has so far accounted for a quarter of the world GDP and been the consumer of the last resort, is in a bad shape. It has been faced with the collapse of its financial sector and lost its competitiveness in major manufacturing sectors like automobiles, consumer durables and electronics. How do you see India and China in this context?

Prof Sheth: All large emerging economies that were insulated from the global financial crisis will do much better than advanced countries. This is also a great opportunity to encourage growth of domestic markets and invite FDI to participate in that growth, especially in those sectors where advanced countries are ready to exit or invest in India and China. Examples of the former are textiles and agriculture and examples of the latter are automobile, pharmaceuticals, defense, security and education.

Power Politics: What do you think are the prospects of foreign investment in India in the context of its deteriorating law and order situation? According to one study, nearly 160 districts are affected by Naxalism or left wing extremism and others by ethnic or religious fundamentalism. And then there are several mafia dons around to scare the investors.

Prof Sheth: It is absolutely critical to manage law and order so that law of the street is channeled toward the law of the courts. This will require speeding up the justice system and strong police and military enforcement of the law.

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