As policy makers pin their hopes on a gradual recovery of the Indian economy in the second half of the current fiscal and the private sector feels enthused over a spate of FDI reforms and fiscal consolidation measures, the World Economic Forum (WEF) will bring both together for the three-day event whose public sessions begin on Wednesday in Gurgaon, Haryana. Also on hand will be members of civil society, to deliberate on governance issues.
This is the first time that WEF will organise its India event on its own. For more than 25 years, the Forum had organised the India Economic Summit in partnership with the Confederation of Indian Industry. WEF calls this change a natural evolution. It has already committed itself to opening an office in India next year. This will be the fourth such office of WEF outside its headquarters in Geneva. It already has offices in New York, Beijing and Tokyo.
“This is part of our commitment to India. This is only appropriate given the role India plays in global networks like G20 and regional fora,” WEF’s senior director and head for Asia, Sushant Palakurthi Rao, said.
With this year’s edition, the event is being called the ‘World Economic Forum on India’. Why did WEF rechristen the event and what purpose does this serve? Explained Rao, “We felt that the India Economic Summit focused too much on the economic dimensions, while the reality is that the summit needs to be about India in the world and its stakeholders. The focus has to be not only on the economy but also government, civil society and entrepreneurial points of view.”
Why is the event taking place in Haryana and not Delhi or any other metropolitan city? Haryana Chief Minister Bhupinder Singh Hooda explained, “The state is at the forefront of creating an ecosystem that rewards both business and society.”
A WEF official explained that the Forum on India will take place in the National Capital Region and another city in alternate years. So, next year, it will be the turn of cities other than in the NCR. Taking the event to south India will also be considered, he said.
The range of participants — from Nestle CEO Paul Bulcke to Infosys Executive Co-Chairman Kris Gopalakrishnan to Commerce and Industry Minister Anand Sharma, Planning Commission Deputy Chairman Montek Singh Ahluwalia to social activist Kiran Bedi to Comptroller and Auditor General Vinod Rai — gives ample indication of the wide-ranging issues to be discussed.
Meanwhile, the backdrop to the Forum is stark. As the government tries to put India on the reforms path, there is uncertainty whether reforms that need to be carried out through the legislative route will be able to secure the opposition’s support.
Growth decelerated to 5.3 per cent in the last quarter of 2011-12 and only picked up a tad to 5.5 per cent in the first quarter of 2012-13. But, inflation rose to 7.81 per cent in September from 7.55 per cent in August, as the effect of the hike in diesel price by Rs 5 a litre came into play. This did not allow the Reserve Bank of India to cut the policy rate even as the growth demanded such a move.
Says WEF in a statement, “India has reached a critical inflection point. Twenty years after the liberalisation of the Indian economy, which unleashed an unparalleled period of sustained high growth, new challenges have emerged in the form of rising inflation, a falling growth rate, delays in much-needed reforms and the attendant waning of investor confidence.”
The Forum will have sessions like ‘Rebooting India’, where issues like fiscal and monetary challenges, implementing swift government reforms, and regaining the confidence of voters and investors will be deliberated on. But the event is not about deliberation only — the theme of the Forum is, “From Deliberation to Transformation”. As such, the best practices from all over the world will be analysed to see if they can be replicated in India.
In India’s “summer of discontent” demonstrated last year, anti-corruption sentiment reached unprecedented levels, leading to one of the largest civil society movements since Indian independence, WEF added.
Alongside sessions, private discussions are also taking place on topics like food security, water scarcity and anti-corruption. And as inclusive growth becomes an issue of paramount importance, the Forum will have sessions on growth beyond numbers, India’s missing women, closing the gender gap, etc.
However, India cannot be easily understood without taking states into account. The session, “Uniting States of India”, will fill this gap. Delhi Chief Minister Sheila Dikshit, Haryana Chief Minister Bhupinder Singh Hooda and Karnataka Chief Minister Jagdish S Shettar will take part in this session.
India’s relations with Pakistan have seen many ups and downs. However, now some sort of seriousness at least in trade normalisation has begun. Pakistan has already issued the list of negative items for exports, which expanded the basket that India can export. It will phase out even this list by December. This may start the process of Pakistan giving most-favoured nation status to India. Reflecting this reality, the Forum will have a session on ‘Insight into Pakistan’.
India plays an important role in the south Asian region, whose stability is important for India’s stability and prosperity. The session — ‘Spurring the Growth of South Asia’s Social Economy’ — will address many issues confronting the region, such as entrepreneurial ecosystems, developing first generation entrepreneurs, etc.
Stephen Harper, the Prime Minister of Canada, will deliver a special address in the first session, “the World Economic Forum’s Vision and Mission”. The presence of a G8 country’s Prime Minister highlights the importance of India in world forums.
Recently, a WEF report cited infrastructure bottlenecks, education, bureaucracy and health as disadvantages for the Indian economy. All these issues will be discussed at the Forum. There are sessions on healthy living, the future of education, inclusive governance, and de-risking cities.