Poll's Toll And The Chance

So the dates for the 14th General Elections in India, third in three years, are finally

out. End September and early October. Which means a few things. Firstly, economic activity

will slacken. Everybody who has an excuse and his grandmother will now plead 'economic

uncertainty' for even the most mundane business activity. And every commercial enterprise

will start downsizing, soft-pedaling and slowing down its plans for the fiscal year.

Secondly, investors, importantly, foreign institutional investors, will start recasting

their plans for the next five months. This could mean holding back on investments, cashing

out on some big opportunities and general lethargy as far as new projects are concerned.

This would mean that the money market may just tighten and interest rates may get affected

and move northward. Thirdly, the government departments will go slow or simply stop

buying. The alibi being that 'you never know what the new government will want.'

Bureaucrats will go into collective hibernation, plans announced will be put on the

backburners and everybody will hold their breaths for the result of the election and the

14th Lok Sabha to be constituted.






Well, don't. In the current political scenario, nothing much might really change. For
instance, will any one party get absolute majority? Unlikely. Will the regional parties

lose their importance? Again, unlikely. Will it be a coalition again? Most likely. Will

the new government be again subject to political compulsions like the earlier one?

Possibly. If all these things are going to remain the way they are, then what is corporate

and economic India waiting for?






Really nothing. In fact this could be a good time, with the budget passed, to go for that
dreamy state-where the economic activity goes on irrespective of the political acts of

commission and omission. For one, bureaucrats need to rid of the 'new political masters'

syndrome and get cracking. Sure, some things may not be possible, like statutes etc. What

is possible are the things envisaged in the budget and for which allocations have been

made.






The Finance Bill is passed and the Credit Policy is also out. It could be a good time for
the industry bodies to press for the Summer Season Policy to be implemented in toto, as

per the directives of the RBI and the erstwhile Commerce Ministry. Let the industry go on

the overdrive and capitalize on the political vacuum rather than feel paralyzed due to it.






Just to leave behind a comforting thought-it has been done before.