Best time to take advantage of global crisis, Anish Shah urges Indian companies

livemint.com:

Bank of India on Friday raised its growth expectations for India’s economy in the current financial year to 7%, from its earlier projection of 6.5%, taking comfort from rising rural consumption and increasing capital expenditure. Shah, also group chief executive and managing director of automaker Mahindra & Mahindra Ltd, said fresh investments were evident in some sectors. “If I comment first on the auto sector, from Mahindra’s perspective, we have doubled capacity for SUVs already… we’ve been ahead of the curve on this.

And that’s also a function of the demand we are seeing for SUVs and we’re looking at creating more capacity," Shah said. On other sectors, he added: “We (have) started to see a lot more demand in India for a variety of things. If you look at holiday resorts, for example, there’s a lot more demand for holidays and hotels in India, and we started to see a lot more investment coming into that space.

So I think it’s just a timing issue (for more capital investments)." Shah’s comments come in the context of policy makers’ expectation that businesses should follow the lead taken by the government in stepping up capital investments to accelerate economic growth. Chief economic advisor V Anantha Nageswaran said last week that greater private investments could accelerate economic growth. “India’s growth engine can now become faster and accelerate if the much-awaited private capital formation kicks into higher gear," Nageswaran said on Friday.

Shah said India’s interest rates are far lower than those in many other economies, and not significantly higher than pre-pandemic levels. “So (what is) more important for us is to ensure that inflation is well under control," said Shah. While RBI kept its repo rate unchanged