NEW DELHI: One of India’s top businessmen has slammed the government over its economic policies, saying it is no longer possible to sell the “India story”.
Companies have long griped about India’s Byzantine rules and suffocating bureaucracy, but perceived inconsistency in government policy, stalled economic reforms and a spate of political scandals have soured the investment mood.
“The world expected a lot from us,” NR Narayana Murthy, chairman emeritus of Bangalore-based software giant Infosys, said in a televised interview Saturday.
“We have fallen far short of expectations and it’s no longer possible to sell the ‘India story’,” Murthy told ET NOW, referring to investor expectations that Asia’s third-largest economy would be a turbo-charged performer.
“I meet a lot of chief executives outside India and earlier India was mentioned once every three times China was mentioned. But now, if China is mentioned 30 times, India is not even mentioned once,” he said.
The attack by Murthy, who founded one of India’s largest software giants, on the Congress government of Premier Manmohan Singh was unusually outspoken for an Indian businessman.
“We have cut our own legs off by our inaction, by our policies,” Murthy said.
Data Friday showed India’s growth remained stuck at three-year lows of 5.5 per cent, a high figure by developed nations’ standards but far below the near double-digit growth of much of the past decade.
Murthy said that controversial anti-tax-avoidance rules proposed earlier this year that included a plan to tax takeovers retroactively had spooked foreign investors. The government is now reviewing the plans.
To “change the law on a retrospective basis is actually like taking a pistol and shooting ourselves”, he told India’s NDTV.
Overseas-investor confidence has tumbled with foreign direct investment for the quarter to June sliding year-on-year by 67 per cent to $4.43 billion.
India’s ability to attract foreign investment is crucial because it urgently needs funds to upgrade dilapidated airports, roads, ports and other infrastructure in order to ease bottlenecks and spur slowing economic growth.