BUSINESS

Adani Ambani among billionaires bullish about India’s economic recovery

The Indian economy seems to be shrugging off the effects of the two pandemic waves as it continues to make a recovery. Lockdowns and travel restrictions seem to be nothing but a distant memory as economic activity picks up the pace. The sentiment was echoed by many prominent businessmen and industrialists like Adani Ambani and Birla, who remained bullish about the country’s economy.

Gautam Adani, Chairman of the Adani Group, was upbeat about the economy when he addressed the annual shareholders’ meet in July. Expressing his confidence in India’s ability to become a $15 trillion economy in the next 20 years, he went on to suggest that India would turn into the largest global market in the near future. The Adani Group is currently one of the fastest growing conglomerates in the country with a majority of its companies staying in the green despite the pandemic. Adani Transmission, for instance, reported a 21.9 per cent rise in consolidated net profits in Q1 FY22. Adani Green was another company that revealed a 23 per cent jump in total income in Q1 FY22.

Unsurprisingly, this is not a view shared alone by Adani. Ambani echoed similar sentiments during his company’s annual shareholders’ meet. He stated that India’s economy would rebound and surprise the world with its tenacity. “But beyond recovery, there will be a rapid resurgence. I have no doubt that India is destined to emerge as one of the top three economies in the world.”

Other Indian billionaires have also expressed similar views. Aditya Birla Group’s Chairman, Kumar Mangalam Birla, said that the economy was regaining its shape after the catastrophic second wave. He also acknowledged that the pandemic accelerated the formalization of the economy and digitalization, saying, “So, I don’t think that anything changes from an economic perspective. This is more of an episodic setback, than a structural setback, as I see it.”

After listening to the words of industry leaders like Adani and Ambani, one might be inclined to think that they have lost touch with reality. However, there is some truth behind their words. The Indian economy is indeed on the front foot again. In the first quarter (April-June), the economy grew by 20.1 per cent against a contraction of 24.4 per cent during the same period last financial. Nevertheless, there is still work to be done as the GDP at constant prices in Q1 was Rs. 32.38 lakh crore – well short of the Rs. 35.66 lakh crore during Q1 of 2019-20.

In the September issue of its monthly bulletin, the Reserve Bank of India (RBI) has disclosed that the inflation trajectory was falling faster than previously anticipated. The bulletin revealed that aggregate demand was growing stronger with most indicators pointing towards a sustained recovery. “As pandemic scars heal and supply conditions are restored with productivity gains, a sustained easing of core inflation can be expected, which will reinforce the growth-supportive stance of monetary policy,” the officials wrote.

Although one can never predict the state of the economy a few months or years down the line, one can always crunch the numbers and make an educated guess. Billionaires like Kumar Mangalam Birla, Adani, Ambani and Mittal have all made calculated guesses based on their experiences and the numbers. And the numbers at present, lie in India’s favour. It would be foolish to ignore what the figures are showing us. Rather, we should be making hay while the sun shines.