Growth Drivers: Improve Investment Productivity And Allocation, Says Nilesh Shah

Improving productivity of investments, private capital expenditure and allocation of savings are necessary to accelerate growth to double digits. This acceleration in economic growth will be the most important thing that will be expected of the new government and make people invest for the next five years, Nilesh Shah, managing director of Kotak Mahindra Asset Management Co. has told NDTV Profit.

"We are now growing between mid and high single digit, but must aim to take it to double digit," the market veteran said on the Markets Mandate show. "India is doing wonderful work in getting someone like Tesla. We also have to ensure our local Elon Musk and Tesla are also encouraged."

While there are enough global capital available, domestic resources must also be allocated in the right way, he said. "Faster growth, better governance and higher corporate profitability are the three things on which markets will be evaluating the government's next steps."

Continuity of the current government after the general election should in itself create momentum, according to Hiren Ved, chief investment officer of Alchemy Capital Management Pvt. A lot of private sector capex programmes and projects will continue to unfold, he said. "The question is what else can this new government do which is an unfinished agenda and that can add plus to the growth."

Ease of doing business and continuity in tax policy is very important to attract foreign capital, Ved said. "If we continue to work on reducing the compliance cost versus not at the cost of quality, I think that itself can bring in a lot of capital."

There is also a need to focus more on investments in research and development, Ved emphasised. "If we really aim to grow at a sustainable pace and become leader in certain areas, we need to do a lot more on R&D."