Prime Minister Narendra Modi will meet industry leaders on Tuesday against the backdrop of a gloom in the market. (AFP File Photo)
Prime Minister Narendra Modi on Tuesday is holding a high-level consultative meeting with business leaders, bankers and economists to discuss the global economic scenario and bolster India's economy by taking advantage of them.
The meeting is being held amid turbulence in global markets caused by a slowing Chinese economy, devaluation of the yuan and concerns surrounding the prospect of a US rate hike. It also comes a day after the rupee hit a two-year low and the Sensex plunged below 25,000.
On Tuesday, Sensex, however, recovered over 118 points to regain the 25,000-mark in early trade largely on the back of value-buying in select blue-chip stocks amid mixed Asian cues.
This is PM Modi's second high-level interaction with industry captains since he assumed office.
As many has 27 business leaders, bankers and economists have been invited for the meeting to deliberate on the recent developments in the global economy and the opportunities they present for India.
Finance minister Arun Jaitley is expected to initiate the two-and-a-half hour meeting on Recent Global Events: Opportunities for India that will conclude with an address by the Prime Minister.
The meeting would also be attended by RBI governor Raghuram Rajan, who everyone has been trying to persuade to cut interest rates, as well as Niti Aayog vice-chairman Arvind Panagariya.
Others who expected at 7, Race Course Road are the heads of India's biggest corporate houses — Ambani brothers Mukesh and Anil, Tata Group's Cyrus Mistry, Aditya Birla Group's Kumar Mangalam Birla, Mahindra & Mahindra's Anand Mahindra, Essar's Shashi Ruia, Bharti Airtel chief Sunil Bharti Mittal, and Adani Group's Gautam Adani.
The heads of the two biggest banks – State Bank of India's Arundhati Bhattacharya and ICICI Bank's Chanda Kochhar – are also expected. The three industry chambers will be represented by their presidents – Sumit Mazumder of CII, Jyotsna Suri of Ficci and Rana Kapoor of Assocham.
To represent the bureaucracy, finance secretary Ratan P Watal, commerce secretary Rita Teaotia, economic affairs secretary Shaktikanta Das and chief economic advisor Arvind Subramanian will be present at the meeting.
Commerce and industry minister Nirmala Sitharaman and DIPP secretary Amitabh Kant are also scheduled to attend the meeting.
What's on the table?
Each speaker will be given three minutes to make initial remarks, sources said.
"The PM wants to discuss if India has an opportunity in this global crisis, and how our markets can regain investors' confidence," said CII's Mazumder.
The brainstorming session may focus on stepping up the reform impetus and industrialists, who have have begun to raise concerns over stalled reforms, may also talk about ease of doing business, investment bottlenecks and poor credit growth.
They may also bring up the government's failure to push critical reform statutes like the GST and the land bills.
On Monday, the benchmark equity index Sensex closed at a 15-month low of 24,893.81 points, down 308 points or about 1.2%. The wider NSE Nifty ended 96 points or about 1.3% lower 7,558.80.
The crisis in the Indian markets was mostly on fears that an expected US rate hike could trigger a foreign investor exodus. A modest improvement in recent US jobs data — an indicator that the world’s largest economy is perking up — fuelled talk the US Federal Reserve might go ahead with raising rates.
If that happens, foreign investors will likely offload their India positions and rush to the US markets as a strong dollar would be more rewarding than emerging markets.
Bad news from China in the form of a lower economic growth forecast also rattled investors already spooked by estimates of a poor monsoon that could hurt the economy and impact the RBI's decision on an interest rate cut.
The sentiment affected the rupee also as the FII (foreign institutional investor) sell-off and importers buying dollars for making payments drove down the Indian currency by 36 paise to 66.82 to a dollar.
The government has been of the view that India should take advantage of the global turbulence and look at how to convert it into an opportunity.
Source - hindustan times