We should look at FDI from China with safeguards: CII President

Having delivered on a long list of reforms, the government should focus on reducing the factor cost of production in sectors such as power, and further incentivising manufacturing, says Rajiv Memani, president of the Confederation of Indian Industry (CII), in an interview with Asit Ranjan Mishra in New Delhi.

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Memani also suggests that the government should fast-track disinvestment of public-sector units and use the proceeds for some large transformational projects. Edited excerpts:

The Centre has undertaken many reforms in the recent past, like the goods and services tax (GST), labour codes. What areas can more be done in?

The government has been undertaking reforms for a long time now, but there is a very palpable sense of urgency that one can see over the last six months. We are living in very interesting global times. Because of geopolitics and geo economics, things are very dynamic in every respect. So reform has to be a very, very constant process — whether it's around power, logistics, labour, land, what can be done for opening up other sectors, and for ease of doing business.

Q. What are the top few priorities the government should be focussing on?

For the government, the biggest priority is to encourage manufacturing much more. And the way to encourage manufacturing is really to see how we create greater value addition in India, which requires some deliberate action and much more focus on the competitiveness of the economy. We feel there has to be an inter-ministerial group, so that we have a very clear strategy on how we should encourage manufacturing in India. That could mean technology tieups, some policy support, and clarity on what the Customs duty rate should be over the next three to five years. We have identified some items like compressors, wafers, APIs (active pharmaceutical ingredients), and some chemicals. I would say that’s one big area.