New Delhi: The larger silence of Indian industrialists about India’s growth slump seemed to bear out an assessment made by former PM Manmohan Singh — that the Modi government’s tenure has been marked by an atmosphere of fear that hasn’t left industrialists untouched either. He had cited this fear as a factor behind the economic slowdown dogging India.
Several prominent Indian industrialists had cheered the Modi government’s decision to cut the corporate tax rate this September, with many saying it would provide the necessary impetus to fuel economic growth.
But few had anything to say Friday as GDP growth for the second quarter of 2019-20 was recorded at a six-year low of 4.5 per cent.
Mahindra Group chairman Anand Mahindra had lauded the corporate tax rate cut with a tweet saying Finance Minister Nirmala Sitharaman had “fired a shot that will be heard around the world”.
Woke up in the U.S to this news. The best way to start the day. Not only because companies will pay less tax.But because this isn’t just another policy tweak. @nsitharaman fired a shot that will be heard around the world. India has sent an invitation letter to global investors. https://t.co/0zx8efGNha
— anand mahindra (@anandmahindra) September 20, 2019
But he has been silent on the spate of reports about India’s economic slump, while being active on social media otherwise.
Kotak Mahindra Bank managing director Uday Kotak’s Twitter timeline has been quiet since 24 November. He, too, had praised the corporate tax rate cut as a “big-bang reform”.
Reducing corporate tax rate to 25% is big bang reform. Allows Indian companies to compete with lower tax jurisdictions like the U.S. It signals that our government is committed to economic growth and supports legitimate tax abiding companies.A bold, progressive step forward.
— Uday Kotak (@udaykotak) September 20, 2019
The Confederation of Indian Industry has not issued a statement on the latest GDP numbers either.
Harsh Goenka, the chairman of RPG Group, had described the corporate tax cut relief as “a virat (giant) cut by FM”.
‘Virat’ cut by FM #Corporatetax. Much needed boost to unleash ‘animal spirits’. I now expect the sentiment to change and private investments to start flowing. Sensex ‘boom’rah!
— Harsh Goenka (@hvgoenka) September 20, 2019
But he is yet to say anything on the GDP decline, although he did retweet a related post from Biocon chairperson Kiran Mazumdar Shaw.
We can quickly rise to the top again with a few pragmatic policies https://t.co/AncXTYwsQD
— Kiran Mazumdar Shaw (@kiranshaw) November 29, 2019
‘Jeena yahaan, marna yahaan’
Some social media users tweeted that the silence of corporate leaders only proved Manmohan Singh’s observation about how a “toxic combination of deep distrust, pervasive fear and a sense of hopelessness” was “stifling economic activity and hence economic growth”.
When BBC journalist Milind Khandekar sought to connect the industry’s silence to Singh’s statement, Goenka replied, “Jeena yahan marna yahan uske siva jaana kahaan (Have to live here, die here, no other place to go)”.
मान गए आपको 🙏
बहुत बड़ी बात कह दी आपने गोयनकाजी 👇 https://t.co/22w6gGU3A1
— Milind Khandekar (@milindkhandekar) November 30, 2019
मान गए आपको 🙏
बहुत बड़ी बात कह दी आपने गोयनकाजी 👇 https://t.co/22w6gGU3A1
— Milind Khandekar (@milindkhandekar) November 30, 2019
Goenka also made a pointed reservation about the recent political developments in Maharashtra, which finally culminated in the swearing in of a Shiv Sena-NCP-Congress government Thursday.
Shiv Sena has CM post ~ HAPPY
Congress surprised to be in government ~ HAPPY
NCP proves to be the kingmaker ~ HAPPY
Fadnavis became CM again as he wanted ~ HAPPY
Media had breaking news every hour ~ HAPPY
And the public ~ NEVER MIND!
— Harsh Goenka (@hvgoenka) November 29, 2019
Also read: With low GDP, RBI’s Shaktikanta Das will need more than rate cuts and a good reputation
Why do you say it is fear? It is a case of not looking the gift horse in the mouth. Foolish government has given a huge and unexpected gift to the rich industrialists. Better not to talk about it, lest it is taken back!
Strange article. The tax cut was intended to encourage investment leading to growth and jobs. India Inc welcomed the tax cuts, pocketed the money and did not invest. Now they are saying it’s because of ‘fear’? Then the easiest thing is return your tax benefit. At least the deficit will be under control.
Shri Samir Saran, President Observer Research Foundation has tweeted : This thread 👇 train wreck of our own making … most saw it coming … no one in government paid heed … maybe economy does not matter to them … having a cameraman in the minister’s office for a Twitter moments is more important … a good pic is better than good policy any day.