Even as the economy has shown signs of recovery over the last few months, Harsh Mariwala, chairman Marico Limited and founder of Ascent Foundation, told Sandeep Singh that for further recovery and growth one needs to be patient as the war against Covid-19 is not over yet, and we can’t let our guard down. Handholding and advising entrepreneurs through his foundation, he said while there is always a case for more support from government during these times, our government did what it could despite weak finances. Edited excerpts:
How do you see the recovery of the Indian economy from the Covid-19 pandemic and where are we in terms of domestic consumption recovery?
Definitely things have turned positive over the last few months. Going forward, a lot will depend upon how disciplined we are because if you are not disciplined, then you may see a repeat of what is happening in the US and Europe. We have seen numbers rising in some states and, so, I don’t think we can relax and take things for granted.
The war is not over yet and while vaccine results are coming in, we have to have some patience.
As for the consumption demand, the recovery is holding up for now and I hope the trend continues. As we start coming back to normal life, the consumption will grow.
Over the last few years, we have not seen a rise in private investment. Do you think it has been pushed back further because of the pandemic?
It is a question of demand generation first. Normally, investments start happening when the capacity utilisation improves and that leads to more investment plans. If the demand generation continues and things get back to normal there will be capital allocation, investment and opportunity for job creation. But, yes, it has been pushed back because of the pandemic. The year 2020-21 has been a washout and though some growth is coming back now, I think it would take almost a year or so. A lot would, however, depend upon how the situation evolves in terms of vaccination and containment of Covid.
Entrepreneurs and MSME players have been hit hard by the pandemic. How do you see it and do you think enough was done to support them?
It depends upon which sector one is operating. For us or companies in the FMCG business or essential items, the impact has been much less, but if one is in hospitality, airlines or restaurant business the impact has been much higher. But, everyone got impacted.
At Ascent Foundation, our role has been to advise all our members on how to meet this crisis, starting from safety measures to addressing their anxiety around business, cutting cost, mental health and so on.
Do you think the government’s support for MSMEs was enough or more could have been done?
As for the government, there is always expectation that more could have been done but one must realise that government has to also meet their ways and means situation and, presently, the overall situation, as far as the fiscal deficit is concerned, is not in a good shape. It has happened when the government finances were under stress, compared to many other countries where government finance has been much better. So, we need to look from that perspective that we did not have a very strong economy.
However, you can’t blame government for everything. Ultimately, the entrepreneur has to create business opportunities. Yes, the environment is bad and that will have an impact.
Over the last few years we have seen a lot of entrepreneurs coming up, but we see most of them selling out and not scaling it to the next level. What stops them from doing that?
To take your business to global scale, you need to have something that is very innovative, has a right to win and offers something unique. If the business doesn’t have it, you can’t scale it up to that level. However, sometimes you may have all this but still you are not able to grow. That is because of reasons such as leadership style, business not able to attract and retain good talent, does not have a right culture or a combination of things.
This is where Ascent comes in as these issues cut across all businesses. Ascent provides a support system where they learn from each other, bring up their issues and resolve them.
What was your thought behind setting up Ascent?
The larger philosophy was to do something where I can add value to others and somewhere I can offer my personal strengths, viewpoints and am able to make a difference. I focussed towards entrepreneurs because I believe they add a lot of value to all the stakeholders — customers, employees, shareholders, associates and finally the society. I also see it as personal social responsibility. We are having our conclave between 25th and 28th and are doing it virtually where we will have some phenomenal speakers such as Dr Raghuram Rajan, Deepak Parekh, Dr Kiran Majumdar Shaw, Sourav Ganguly, among others, along with panel discussions, which I think will benefit over 1,000 entrepreneurs who have registered to participate from across the country.
How can we have a more vibrant entrepreneurial environment?
We need to promote entrepreneurship and the starting point is how they are viewed in the society.
How risk is viewed in the society is a very big issue in India. If as a society, we promote it and say that it is OK to fail, people will start taking risk.
There is a sense that over the last few years the risk taking ability in India has gone down following actions of enforcement and tax authorities. How do you see that?
The fact that the government wants businesses to do well, I think they are trying to improve the environment. It takes time to change the mindset of the tax authorities but I think there is a realisation that entrepreneurs play an important role in driving growth. One must also note that there are some entrepreneurs who don’t follow ethical practices or governance practices and they need to be punished. We can’t turn blind eye to such entrepreneurs.
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