When Prime Minister Narendra Modi surprised the nation on November 8, 2016, by announcing the demonetisation of the high-value currency notes of Rs 500 and Rs 1,000, it was evident that there would be short-term pain associated with the move. Modi, in his address to the nation that night, even said so. As his finance minister, Arun Jaitley, prepares to present his fourth budget, it is now clear that Budget 2017 will be a vital statement of intent from the Modi government. Post demonetisation and the attempt to cleanse the country of a large portion of the black economy, Jaitley will need to ensure that economic growth, which is bound to take an immediate hit, is quickly brought back on track and that the disruption doesn’t extend to a level which leaves a gash. With the Goods and Services Tax (GST) rollout still a work in progress and expected this year, the finance minister has to be mindful that even as such reforms are rolled out, all growth engines begin working at optimum capacity once again. Remember, global economic conditions are challenging. With a new political dispensation in the United States and the aftermath of Brexit, the global economy is bound to throw up surprises which India will need to face squarely. It is imperative, then, that the domestic economy gets back to normal as quickly as possible. If there’s a single objective Jaitley’s budget must have, this must be it. That’s why we are calling this budget ‘The Big Reboot’.
There are enough domestic speed breakers for the finance minister too. Exports continue to be a major problem, consumption expenditure has taken a hit and private investment isn’t showing signs of a pickup. While the jury is out on the impact of demonetisation, corporate India wants a budget which seeds growth. As Deputy Executive Editor N Madhavan, who helmed this issue, writes: Budget 2017 is also an opportunity Jaitley cannot afford to miss if the Modi government wants a robust report card going into the 2019 general elections. And Pawan Goenka, managing director of auto maker Mahindra & Mahindra, says, “Out of the box ideas are the need of the hour.”
This pre-budget special issue also has an exclusive poll of some of India’s top CEOs and CFOs, conducted for us by BMR Advisors. More than half of the respondents in the poll felt that the theme for this year should continue to be simplification and streamlining of economic policies.
While India prepares for the budget, there’s big news from the House of Tata, and thankfully it’s not about the battle with Cyrus Mistry this time (that, of course, continues). Natarajan Chandrasekaran, the boss of the group’s crown jewel Tata Consultancy Services (TCS), has been elevated as the new chairman of Tata Sons, the holding company of the Tata group. Chandrasekaran’s ascension to the top job has been widely welcomed by corporate India since he is a Tata lifer and has led TCS with much success over the years. How the 1963-born Chandra leads the $103 billion-plus conglomerate of 100 companies operating in 100 countries will be most interesting to watch.
Editor, Forbes India
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(This story appears in the 03 February, 2017 issue of Forbes India. To visit our Archives, click here.)