India Inc should stop spreading negativity: Deveshwar

By Shereen Bhan

It’s no longer the traditional tobacco products but the relatively newer FMCG business that is driving the growth of cigarette major ITC, the company’s Chairman YC Deveshwar said .

Both top line and bottomline in businesses other than cigarettes are showing higher rates of growth, he said in an interview to CNBC-TV18 .

“Many of our categories within the others are now turned around. The major drag now is our three-year-old personal care business which requires a huge amount of investments. I am very satisfied with the progress and the growth rate of above 25%,” said Deveshwar.

He further added he is expecting Rs 1500 crore in topline from the FMCG business by FY2017.

Speaking about the investment climate in the country, Deveshwar said that corporate leaders in India were

talking themselves into a slowdown by sounding negative about the economy in their media interactions.

It is the sentiment that drives economic growth, and it’s unfortunate that most of our business leaders appear on the front pages of newspapers and say that everything is gloom and doom, he said.

“At the end of the day we need to invest in India. This is a land of opportunity. The growth rate at 7% is higher than most countries. Few countries like China, Indonesia and some African country have a growth rate of 7%,” he added.

Here are important excerpts of YC Deveshwar’s interview with CNBC-TV18:

Q: You are almost sounding like the government; the Prime Minister chided corporate India for being too negative, for being too anti-government?

A: This is also a factor. The consumption story has not been completely extinguished. There are lots of people now investing overseas. Increasing overseas investments will open up markets in India which will be a source of fulfilling that demand.

Q: If creating a sustainable profitable business requires you to look outside then why is it a problem?

A: It is not a problem for capital but it is a problem for the country because we are trying to attract foreign capital and charity begins at home.

The issue is, if by saying that “I am going to take my capital out and you will create pressure on somebody to create consensus quickly, it’s not going to happen.” Our strategy is very audacious and a difficult one of creating Indian brands. Indian brands, competing with worlds finest multinational companies we are operating in India.

Q: You have an obligation to your shareholders. If you feel that opportunity overseas gives you better returns on capital then what is the problem?

A: I am of the belief that before shareholders comes the society.

Q: It’s not as simple and it’s not as black and white as you make it so?

A: At the end of the day we need to invest in India. This is a land of opportunity. The growth rate at 7% is higher than most countries. Few countries like China, Indonesia and some African country have a growth rate of 7%.

Q: Nobody has a problem investing. They are saying we are not being allowed to invest because of the various problems. People say investment is not the problem but approvals are?

A: Is, to run away from here the answer to the problem.

Q: Some people seem to take that route or say we will take that route?

A: People are ready to nourish more capital than nourish the country. Our threshold of patience is therefore lower. I would rather say, let’s stick it out here. If you want to create some pressure, yes do. If you want to make a false move and say, I am going out and unless you do something out of the blue.

Q: You believe it’s a false move and a threat?

A: Don’t run away with the capital from here because this country needs it.

Q: You believe it’s a threat?

A: Yes, Most industrial houses have their heart in India but it is their frustration that is speaking.