M A I N   N E W S

Don’t be pessimistic about economy, says Tata
Girja Shankar Kaura/TNS

New Delhi, January 5
In what would come as a major boost to the government fighting hard to control inflation and facing criticism from Indian Inc, Tata Group Chairman Ratan Tata today said there was no need to be pessimistic about the Indian economy despite the global uncertainties.

Talking to reporters here at Auto Expo, where he was present to unveil a new range of automobile from Tata Motors, Ratan Tata differing from the views of some of the leading corporate houses, which have been criticising the government for a policy paralysis said that India's economic fundamentals are strong.

"We must stop pessimism. India's fundamentals are correct and we should be striving for retaining growth rate," Tata said.

His comments came within days of Prime Minister Manmohan Singh hitting out at industry leaders for their "negative comments" on the government policies. Singh had said that such remarks had added to the uncertainty.

Tata suggested that the government must look at accelerating expenditure and create jobs, which were slowing down partly due to the fiscal policy and late decision taken by various ministries. "If we focus on infrastructure it will be good not only for today but in the future as well," he said.

In what could also come as an encouragement to West Bengal Chief Minister Mamata Banerjee, Tata indicated that the company was open to going back to the state with its investment despite the problems that had occurred earlier.

Tata said: "I do not think our position has changed. As and when the hostilities are over and we get an amicable reception, we will think of it."

Tata Motors had pulled out of Singur in West Bengal in 2008 after protesters led by Mamata Banerjee had forced a complete shutdown in the area. Tata Motors had planned to set up a Rs 1,500 crore (Rs 15 billion) manufacturing plant for Nano.

Later, it moved to Sanand in Gujarat and announced over Rs 2,000-crore (Rs 20 billion) investment there.

He further said that Tata Motors had to move out from Singur when nearly 85 to 90 per cent of the project had been completed with nearly 3,00,000 orders in hand.

He admitted that Tata Motors was not able to get the marketing strategy right initially for Nano, the cheapest car in the stable.

He pointed out that the concept for the small and cheap car remains robust despite attempts to discredit the vehicle. “We do not consider Nano as a flop,” he said even though the company sold just about 7,400 units in December 2011.

“We never marketed Nano as the poor man’s car and do not consider it a flop. We simply wasted an early opportunity. There is still no competition to the pricing of Nano,” said Tata.