Fiscal Stimulus For Ural India Could Drive Consumerism

Recently appointed Chairman of Dabur, Amit Burman, the youngest to occupy the post, is credited with conceiving and nurturing the Real Juice brand and making it a category leader. In a free-wheeling conversation with BW Businessworld’s Jyotsna Sharma, Burman talks about his as well as Dabur’s journey, the challenges they faced along the way, besides a whole gamut of issues includingrship, Indian economy and its challenges, among other things.

- Jyotsna Sharma

What are your views on the state of the economy?

The economy is going through a slowdown for sure, and you see that across industries like automobiles, durables, consumer goods, etc. According to syndicated data, the overall growth rates have softened for the industry on the whole. In fact, they are at a two-year low for the industry. And this, they say, is being felt across urban and rural markets. Progressively, the growth rates for the FMCG industry have hit a low of around 7.5 per cent from a high of nearly 19 per cent in November last year. Volume growths for the FMCG industry are even lower at nearly 4 per cent. While rural India is witnessing an agrarian crisis, urban consumers seem to be holding on to their purse-strings. This has been further aggravated by the overall liquidity crunch in the market.

However, I don’t think this is structural and the situation should likely improve from the second half of the fiscal with the festive season setting in. If the government doles out some fiscal stimulus for rural India, that would put additional money in the pockets of rural consumers and further drive consumerism for branded consumer staples.

What, according to you, does India need to do to become a $5 trillion economy?

It’s an achievable target, but suitable measures need to be taken well in time. While some external factors like geopolitical climate, crude oil prices and rupee value are not in the hands of the government, there are other measures that they can take to drive the economy on the high growth path. Higher spending on infrastructure development will be a key area for the government to focus on. Besides, they will also have to work on boosting private investment, higher disinvestment and pushing forward key structural reforms, along with a focus on creating jobs. The manufacturing sector too needs to revive quickly to drive growth, boost export and generate employment.