When a seasoned journalist asks the right probing questions, even corporate head honchos squirm, as happened at a discussion on 'Unleashing India's Potential: Next Steps for an Enhanced Investment Climate.' The discussion -- part of the Asia Society's 16th Asian Corporate Conference that concluded on Monday at Mumbai's Grand Hyatt hotel -- moderated by The Wall Street Journal senior special writer Henny Sender, had the four corporate panellists facing such uncomfortable topics such as does India need labour reform? do special economic zones make a difference? is the Indian workforce less efficient? is the bureaucracy corrupt? is protectionism still alive? is the so-called 'Bombay Club' of capitalists dying?
Sender -- who was clearly having a blast needling Dinyar DeVitre, senior vice-president and chief financial officer, Altria Group Inc, Warburg Pincus India Managing Director Rajesh Khanna, American International Group India country head Sunil Mehta, and Coca-Cola India president Atul Singh -- spared no one.
While the Bombay Club was ill, it was nowhere near the grave, confessed DeVitre, a native of Mumbai, now a resident of New York.
Though they get it in China, investors are not looking for handouts or special treatment in India, he said. What they were looking for is a level playing field, he added.
He noted that the Press Note 18's (the legislation capping foreign direct investment) amendment to Press Note 1 last year was a "half-reform" because it still kept the approval process in the hands of government departments, which weren't always transparent.
Unless India gave investors the "feel-good factor of confidence" India would continue to lag way behind China in attracting FDI, he said.
Mehta said the key issue was to take India to 10 per cent growth in the next few years. Transparent regulatory processes were needed, and sectors like infrastructure, insurance and pensions needed to be opened up further.
That would spark employment generation, increase efficiency even in the public sector layers, he said.
Khanna said there was no problem with deals being black or white -- it was the grey areas that worried investors.
When Singh said China had a more disciplined labour force, Sender was right on the ball with the question: Just how does China discipline its labour force?
Singh's answer was a rather sheepish "of course, India is a democratic country."
Other takeaways from the discussion included admission that management talent in Indian companies was much better than the average Chinese firm, that the public sector would have to raise remuneration to retain talent, that labour reforms are a must for companies to invest more in India, that India could and should aspire to give the world global brands, and that the "genuine interest" of Prime Minister Dr Manmohan Singh and Planning Commission Deputy Chairman Montek Singh Ahluwalia to open up the country to more investment needed to percolate through.
When Sender cited the example of a chief of a Chinese web site's candid statement that her company never asked for permissions, but only for apology, there was also the admission that in India, very little is allowed, but everything is possible.
Sender also pointed out that Hyundai will this year be making as many cars in India as in Korea, and that the auto company has agreed its India staff is as efficient as their Korean counterparts, and much more efficient than there colleagues in Alabama.
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