“Social media problem not only in India”
NEW DELHI: TV Narendran, CEO and MD of Tata Steel, who has assumed the office of new president of the Confederation of Indian Industry (CII), says the country is not unique when it comes to what to do with social media companies happens and calls for regulations to be contextually appropriate. In an interview with TOI, he sees the effects of the second Covid wave on the economy as less serious. Excerpts:
How do you assess the second wave of the pandemic?
The second wave was less economically effective than the first. From a humanitarian point of view, the second wave had a much stronger impact. During the first wave, the lockdown happened very quickly, the industry was insufficiently prepared, and the entire supply chain was disrupted. This time we didn’t have that kind of complete lockdown. The industry was better prepared. It looks better globally. The effect of multiple country incentives is showing, making India’s exports strong. The global disruption in supply chains did not occur as it did last year.
The challenge for governments is to ensure that people exercise discipline and do not take unreasonable risks in the future. The only concern we had was that the rural economy would pick up again like last year or is the situation in the rural community much worse than we think? The sign we’ve been getting in recent weeks is that the rural economy is not doing badly. When I talk to tractor manufacturers, they say it’s not that bad. Monsoons are ahead of expectations. When we are having a good monsoon and the rural markets are strong this is a good place to start recreation and then the auto sector is the space to watch. Things are better than we thought three or four weeks ago. That’s why we feel we need an incentive just to make sure we don’t slip.
Do you see stagnating consumption as a challenge?
It is important for us to work through companies, through industries, to ensure that jobs are created, jobs are protected as much as possible. Second, how do we make sure vaccination takes place? When you have a Covid 3.0 you cannot endure too much of this type of disruption every few months as it would throw the whole drive for growth or the whole agenda completely off track. Then you can’t do anything about jobs or anything else. Vaccination is step one. Step two is that we protect livelihoods as well as lives. We need to focus on areas of the economy that are more stressed so that job losses in those areas are minimized and consumption returns. The other thing is that over the next six months we can have a temporary reduction in GST for consumer products. Which is not a permanent change, but rather to help people manage their expenses better when they are spending more on medical expenses, at least so that they don’t feel the need as much. And for the rural economy, how can we increase the allocation for the MGNREGA program and ensure that the money is spent productively?
Do you see the effects of the second wave and now the clashes with large technology companies that are damaging India’s image as an investment location?
Everyone went through the pandemic, dealt with it differently, and has different effects. If we get vaccination up and running again very quickly, I hope that we can regain some of the trust the world has placed in us, which will come back once we get the economy and vaccination going again. The other aspect of the social media argument with the government – this is happening all over the world. Australia has a problem, Europe always has problems, there are different dimensions that are played out. This is a loosely regulated space and when regulations come up there will be problems, there will be talks and we will hopefully strike the right balance. India is not unique in what happens to social media companies. You can argue the intricacies of the debate, but on a very fundamental level, the fact that regulations will evolve to meet these challenges – which are new challenges – is inevitable. What CII can do is work with government and industry to ensure that the regulatory environment transitions smoothly into an appropriate one as many of these rules are also not considered. The tax laws were designed for physical supply chains and not for those types of supply chains or for positioning companies anywhere. When the world changes, so too must regulations to be contextually appropriate.