SK Narvar, Chairman, Capital India Corp, one of the leading voices of the industry is bullish and optimistic on India’s strong economic recovery from Covid-19 triggered crisis. He says that several high-frequency indicators like PMI data, GST mop-up, toll collections, e-way bills and power consumption have shown an uptick in September and they already indicate that economic revival is in the works.
“Next 100 days- which mark the onset of the festive season in our country – will be critical for our economic revival. And I believe that we are up for the challenge,” says SK Narvar, Chairman, Capital India Corp.
Below are the excerpts from interview:
The International Monetary Fund and the World Bank have recently projected double-digit contractions for India in FY21. Your comments?
It is imperative to note that the IMF has also said that India is likely to bounce back with an impressive 8.8% growth rate in 2021. The recently-introduced fiscal incentives by the Indian government will power this resurgence. Over the last few months, under the leadership of Prime Minister Narendra Modi, we have seen bold reforms to facilitate the country’s economic recovery. From agriculture to defence, from realty to space, from education to labour, every sector has witnessed stimulus that promote growth. I believe that we have started recovering from the crisis.
The COVID-19 induced lockdown has adversely impacted the global economy at large and India is no exception. According to the Trade and Development Report 2020 by UN Conference on Trade and Development (UNCTAD), international trade will shrink by around one-fifth this year, foreign direct investment flows by up to 40%, and remittances will drop by over USD 100 billion.
True, the month of September 20 witnessed significant improvements in some of India’s economic parameters.
India’s economic performance in the last month has been promising. Exports returned to 98% of normalcy levels, while imports regained 74% of normal volumes. Economic activity was pegged at 93% of pre-pandemic levels while the business activity index also accelerated during the month. Several high-frequency indicators like PMI data, GST mop-up, toll collections, e-way bills and power consumption have shown an uptick in September. The automobile and two-wheeler segments also registered a healthy performance during the month. The petrochemicals and financial services industries have also witnessed an upturn. To put simply, a gradual demand resurgence is evident across most sectors.
These numbers indicate the onset of India’s revival voyage. While making a powerful beginning is essential, it is equally vital to keep up the momentum of progress. In my view, the next 100 days will be a critical juncture in India’s economic recovery journey from the COVID-19 crisis.
That’s an interesting observation. Can you elaborate further on the 100-days view?
The rebound signals pent-up demand and points at further recovery prospects across all sectors. The Government has played its role by introducing multiple structural and fiscal reforms since the outbreak of the pandemic. These regulations will not just help us recover from the current crisis but will also lay the foundation for the next phase of our economic growth. The Atmanirbhar Bharat campaign is a fine example in this context.
Businesses and entrepreneurs should now capitalise the opportunities to get back into a growth mode. The next 100 days- which mark the onset of the festive season in our country – will be critical for our economic revival. And I believe that we are up for the challenge.
Can you give us an example of this revival signs?
Let me cite an example which convinces me of our nation’s readiness: we launched Rapipay’s Micro ATMs in August. Our devices were one of the channels that facilitated the withdrawals of Government’s disbursement of INR 1.75 lakh crore into Jan Dhan accounts of workers, labours, farmers etc. during the lockdown period.
Beyond the convenience of automated teller machines for consumers, our RapiPay’s BC model plays a vital role in building an ‘Atmanirbhar Bharat’ by providing self-employment and additional income opportunities to lakhs of Indian retailers. I’m proud to note that the team has installed over 25,000 devices of Rapipay’s Micro ATMs within a month of its launch. The number does not just indicate the penetration of our services but also the willingness of entrepreneurs to accommodate new offerings which are attuned to the post-pandemic world.
Over the last few weeks, India is said to have passed the peak of its COVID-19 caseload. Do you think the situation will normalize soon?
While the vaccine for COVID-19 is expected by early 2021, it will take much longer to roll out its distribution across the length and breadth of the country. Until then, social distancing is our most effective defence against the contagion.
Businesses need to now adapt to the new normal. As citizens, we should strictly adhere to social distancing norms and COVID etiquette until the mass availability of the vaccine. Let us not forget that containing the pandemic is our collective responsibility.
What is your view on the Government’s approach to containing the pandemic?
Under the leadership of Prime Minister Narendra Modi, the Government has been greatly successful in containing the pandemic. As the PM noted in his speech last evening, India’s recovery rate is among the highest in the world; the fatality rate is low. Out of every million, we have around 83 deaths. Many other nations have witnessed up to 600 deaths per million. Over 90 lakh beds are available for patients. 2,000 labs are working for COVID tests.
While these numbers are impressive, we should not let our guards down and continue to practise the highest level of caution to curb the spread of COVID-19 contagion. Herein I’d like to mention that it is reassuring to know that the Government is making all efforts to ensure that vaccine, whenever it is launched, reaches every Indian.
Until then, it is our collective responsibility to curb the spread of the pandemic. I’d like to quote the Hon’ble Prime Minister, “Till the time we do not get the vaccine, even a little irresponsibility can harm us and all those around us. Wear masks, maintain 2 gaj ki doori, wash hands regularly, use sanitisers and do not venture out unless absolutely necessary.”
