Prime Minister Narendra Modi called Indian business leaders to his official residence Tuesday to discuss how to bulwark the country as China’s slowdown continues to send shock waves through the global economy.
In the three-hour summit, executives and economists ran through a long-standing wish list that includes investing more in infrastructure, expediting government clearances and lowering capital costs. Some executives suggested an interest-rate cut was overdue from the central bank, and that domestic companies should be given more protection from inexpensive imports.
“We have to be cautious, while we take some bold steps on the economy to increase growth,” Rana Kapoor, chief executive of Yes Bank Ltd., told reporters after leaving the meeting. “At the same time, you have to make sure that India has a soft landing after the severe impact of the yuan devaluation.” There has been a jump in foreign direct investment in India this year. But the executives told Mr. Modi that local companies need to see long-delayed improvements in economic management before they can ramp up capital spending. “Domestic investment is at a standstill, and that’s largely because there is no demand,” said Jyotsna Suri, president of the Federation of Indian Chambers of Commerce and Industry.
Mr. Modi reiterated that the world-wide turbulence is an opportunity to highlight India’s resilient growth, vast domestic market and government policies geared toward promoting investment, Finance Minister Arun Jaitley said.
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