1) The document discusses how Narendra Modi's new government in India aims to stimulate the country's economy through reforms like simplifying taxes, encouraging foreign investment, and streamlining agriculture. 2) It notes that India needs significant infrastructure improvements, especially in areas like roads, railways, ports, and airports in order to better support supply chain needs and become a global logistics hub. 3) The author hopes that Modi will deliver on promises like reducing policy paralysis and corruption in order to inspire more business investment and job growth in India.

1. SCMPr
n insight
n Human Resource
n report
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Supply Chain Management Professional
insight
India’s Foreign
policy paves pay for
optimistic supply
chains.
Page...07
International
Feature
Recasting Mid-
dlemen in the
Produce Supply
Chain.
Page...38
report
Transportation
and Logistics
2030 .
Page...34
May 2014 Vol. 2—No. 3
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Fast,
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2. Is This
The Fresh Start
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W
ith India’s gen-
eral election now
largely out of the
way and The BJP-
led party having emerged victori-
ous with a landslide victory, busi-
ness leaders throughout India and
the world await for signs that will
kick start the Indian economy.
Narendra Modi, the new PM,
campaigned predominantly on is-
sues of development and anti-cor-
ruption. But is this enough? And
more importantly, can he really
deliver the kind of changes needed
to inspire international business to
invest in India?
Last five years, the Indian econ-
omy has faltered with business
growth stalling and the currency
witnessing huge volatility. This
volatility continued its severity and
affected major macro-economic
data, including investment growth,
inflation, trade and investment.
Managing volatility in the cur-
rency markets has become a big
challenge for policymakers and
Modi’s BJP party will face the same
challenges. Despite a series of meas-
ures taken by the central bank as
well as the government to curb the
volatility in the markets, the rupee
continues to depreciate. The trend
is unlikely to reverse any time soon.
The rupee depreciation is hurt-
ing the Indian economy. It’s fuel-
ling inflation and has hurt eco-
nomic growth. Growth that is
desperately needed if India is to
reverse it is ever increasing unem-
ployment rate.
The failure of the previous gov-
ernment to unify the states and to
stamp out unnecessary bureaucra-
cy and corruption, both organized
and unorganized, has reduced the
appetite of multinational business
Regulatory uncertainty under the previous government has prevented the kind of growth all
anticipated. Darryl Judd says with Modi government in centre may be this is the start India need,
says Darryl Judd
Darryl Judd
COO, Logistics Executive
darrylj@logisticsexecutve.com
to invest on the scale needed to
ensure India continues a growth
needed to support its growing
population.
Structural reforms have fallen
foul of political gridlock in the past
and the hope is that Modi can clear
roadblocks. Analysts say India needs
to simplify its tax code, encourage
foreign investment and streamline
agricultural production. Modi will
have to move fast if he’s to meet the
expectations of international busi-
nesses and encourage their invest-
ment in India’s recovery.
Modi likes to emphasize his
management credentials. He cam-
paigned on a record of low unem-
ployment and high foreign invest-
ment in Gujarat, the state he has
led since 2001.He has promised to
end policy paralysis, reduce infla-
tion and tackle corruption. He has
also pledged to establish manu-
facturing hubs and industrial cor-
ridors, improve the tax code and
reform the banking sector.
This all sounds good and cer-
tainly has the potential to drive
economic growth, spurring on em-
ployment. But can he deliver on the
kind of infrastructure necessary to
make a difference to supply chain?
According to DHL’s recent Glo-
bal Logistics Report, a vital step in
India’s further development is ex-
panding the road and rail networks,
and modernizing harbors and air-
ports. An increasing globalization
has raised volumes of transport
without a commensurate increase
in logistics infrastructure. Moderni-
zation of systems, facilities and im-
port/export duties are keys areas to
attract overseas investment.
Transshipping times for ships
in Indian harbors are three to four
times longer than the average time
in the West. So the cost of logistics.
For this reason, India will have dif-
ficulties positioning itself as a glo-
bal logistics hub unless firm com-
mitments are made.
Road Transportation is an im-
portant link that facilitates produc-
tivity and competitive efficiency,
leading to rapid economic devel-
opment. It also brings about the
development of remote regions by
opening them to trade and invest-
ment. And it’s not just infrastruc-
ture development that needs com-
mitment. It’s cultural issues such
as corruption that businesses will
be looking at Modi for. The cul-
ture of acceptance must cease and
Modi must be true to his commit-
ments to stamp this out at all levels
and lead cultural change. This will
ensure future levels of necessary
employment growth if India Is to
reduce its long-term unemploy-
ment and improve the prosperity
of more than 30 percent of India’s
population who live below extreme
poverty.
Let’s hopes that this is the fresh
start that India so desperately
needs.