AS Prime Minister Manmohan Singh slips on his old Finance Ministry boots, the industry is closely watching his first steps.

Even as the Indian economy cannot be seen in isolation from events around the world, the industry believes a lot needs to be done, and undone, at home too.

The Prime Minister has initiated steps to reverse the climate of pessimism and revive investor sentiment with a series of meetings with Planning Commission Deputy Chairman Montek Singh Ahluwalia, PMEAC Chairman C. Rangarajan and top Finance Ministry officials.

Here’s a look at the expectations industry leaders have:

Improve liquidity

CII president Adi Godrej, while suggesting a 10-point agenda for economic revival, said as a first step, Repo rate and the CRR should be cut by 100 basis points each to reduce interest rates and improve liquidity.

He wanted the government should announce the setting up of 50 large projects in the next 30 days to revive investor interest, besides allowing 25 per cent accelerated depreciation for investments in plant and machinery.

While a clear and quick plan for fiscal consolidation should be announced to create a growth momentum, the falling rupee and deteriorating current account deficit would not only need stronger intervention by the Reserve Bank India (RBI) in the foreign exchange markets but there was also a need to attract private transfers from NRIs and PIOs by issuing bonds like Resurgent India Bonds.

Godrej said the RBI should also allow direct access to importers of items which have inelastic demand, such as oil, for their foreign exchange requirements and create an “Export Development Fund” to support small exporters.

Energy security

The chairman of a public sector enterprise, who did not wish to be identified, said the slowing GDP growth rate, falling rupee, subdued investments and the much-hyped policy paralysis are a few among hundreds of reasons weakening the sentiment on economy.

He said that there was a need to pump up both foreign and domestic investment in infrastructure.

India needed more factories to generate employment. So there was a need to revive the concept of SEZs and promote them with incentives, besides having a nation-wide policy on achieving energy security. With adequate energy and electricity, factories and the services-based economy would not take off. Access to affordable energy was critical for industry as well as agriculture, he said.

Build supply side

PHDCCI secretary general Susmita Shekhar was also of the view that economic slowdown has been mainly driven by industrial deceleration, which has taken a toll on the overall growth. There have been severe roadblocks stemming from poor performance of the manufacturing and capital goods segments.

At this juncture, effective policy interventions and reform to kickstart the growth in these sectors are needed.

While investor friendly policies would nudge entrepreneurs to invest, rapid infrastructure development could put the economy on a sustained growth path. Shekhar said it was an opportune time to reassure investors with promises to open more avenues for projects and partnerships.

She said a well articulated logistics strategy was a must. Progress in this sector could help the economy overcome several supply side bottlenecks, which hinder development and create inflationary scenarios. The government should incentivise private participation in development of the supply chain, she added.

Sugar it

Abinash Verma, Director General of the Indian Sugar Mills Association, pointed out that the sugar industry was the only one that had not benefited from the reforms of the ’90s. The government now had to ensure that this industry too was given the basic freedom to grow and achieve its potential.