A quick post PM's independence speech telephonic survey of
some market participants finds a large majority confused.
All of them are deeply impressed by the high emotional quotient,
commitment and nationalistic fervor of the speech. However, many of them
sounded disappointed by lack of specific project and scheme announcements that
can boost the market Monday morning.
We, for the record, are deeply impressed by the tone, tenor
and contents of the PM's speech. The speech encourages us to increase our bets
on Indian economy.
We heard many Big Bang announcements in the speech, which
many market participants perhaps would notice in the months to come.
Specifically, we would like to highlights the following:
(a) For the first time since Lal Bahadur Shastri, a PM has
underplayed the role of the government and highlighted the role and
responsibilities of citizens in building a progressive society. PM rightly
pointed out that all 1.25bn Indians need to contribute in nation building and
the government will only play the role of a constructive facilitator and
coordinator with compassion.
(b) The PM emphasized the importance of quality and
sustainability in the process of growth and development.
(c) Emphasis on building strong national character through
commitment to cleanliness, social harmony, peace, socio-economic equality is
also first.
(d) Commitment to restoration of true federal structure of government,
that got lost in the personal ambition and insecurities of Mrs. Indira Gandhi,
may pave way for the balanced, equitable and sustainable growth of the country.
(e) Emphasis on protection of personal dignity of all
citizens as guaranteed by the constitution may help restoring the faith in
Nation State and thus enhance the compliance level.
(f) Engaging all elected representatives in the nation
building process will help ease the power struggle, corruption, and encourage
healthy competition amongst legislatures and local communities. Through model
village schemes (Smart villages with urban civic amenities) all elected
representatives will have an opportunity to demonstrate their organizing,
project management and development capabilities and will be able to rise in
national hierarchy. Each of them will have a project named after them as legacy
to show case (so far domain of a few families).
Insofar as financial markets are concerned, we believe that
the PM has just announced seriously big bang structural changes in the whole
economic paradigm. For example,
(1) In our view, the new manufacturing policy is on the
anvil that would enable India become an important international
manufacturing hub. "Make in India" mission shall see far reaching
changes in SEZ policy, FDI rules, taxation policy, land acquisition policy, and
sustainability rules.
(2) The disbanding of central planning commission shall
strengthen the federal structure. Deeper center-state cooperation will improve
execution and bridge the trust deficit. Estimates suggest huge savings could be
achieved by removing redundancies through combining state and center welfare
schemes.
(3) A common SAARC trade area could bring serious benefits
to many industries.
(4) Development of MSMEs with focus on quality,
sustainability and import substitution is a noble thought.
(5) Massive financial inclusion scheme is aimed at
eliminating exploitation of poor and leakages in delivery of government
assistance.
The last but not the least, by not referring to the
menace of corruption even once in his 64min speech, PM has highlighted
total confidence in his team and his ability in making it a non-issue sooner
than later.
It is also a matter of comfort and delight for us that many
of our suggestions have found place in PM's speech. In particular the
following:
Regards a very Happy Independence Day to all our readers.
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