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Government's second term will be absolutely growth-oriented: Anil Agarwal

"I have never seen support from the govt being extended in this manner... I had not seen this awareness in the last 30-40 years," said Anil Agarwal.

, ET Bureau|
Updated: May 27, 2019, 09.08 AM IST
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"Globally, the first term is used to settle down but the second term can guarantee continuity of policies," said Anil Agarwal.
For Anil Agarwal, chairman, Vedanta Resources, “these are exciting times when people should take risks.” The metals maven believes a bigger mandate for the ruling coalition might help create an omnibus resources ministry to regulate the mining of oil, gas and other minerals. Neither is he too concerned about high leverage at some resources companies in India. “The world has been built with the help of leverage,” Agarwal tells Vatsala Gaur and Satish John. Edited excerpts.

Your thoughts on election results...
The world is excited. This term will be absolutely growth-oriented, which is what everybody is hoping. The first agenda would be eradicating poverty and creating a large number of jobs.

What are the tasks the Narendra Modi government should undertake to transform the economy?
India’s backbone is still the public sector, including banks and companies. In no leading democracy does the government run businesses. The government has no business to be in business. That transformation is important because people who run PSUs want autonomy and are scared of the policing. They want to be independent so let’s give them independent boards with CEOs and let them run the companies. Maybe then, foreign companies will infuse equity in them, be it coal, power, an oil company or a bank. There is potential of increasing production by three to four times.

With this mandate, do you think the PM will take bold decisions seen to be business- and growth-friendly?
Globally, the first term is used to settle down but the second term can guarantee continuity of policies. He (Modi) has understood very well that the world does not want India to produce and wants to make it a dumping ground. It is important to break that. He is clear that India should produce. There will be hindrances, as we are just starting while other countries have reached saturation point. There is no doubt we have to produce our own natural resources. This will cut imports and that money saved can be spent on development. We have to start at the bottom.
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In Odisha, Andhra Pradesh and Tamil Nadu, the opposition has managed to stay in power. Do you believe it will be difficult for industrialists with business exposure in these states?
In his speech, our Prime Minister was very clear that all MPs and MLAs will be treated equally by him as they are elected by the people. We have to build India. We understand India. We are building the largest site in the world for exploration and production of oil in Barmer. The largest rig is now running. If you ask our people, they will say we can’t go to the border to take a bullet, but we can produce oil for our country.

Private companies are not investing as much as they should... due to liquidity crunch, overleveraging and demand slowdown. Will this change?
Whenever Indian entrepreneurs are entrusted, they have built world-class assets. Like Jet Airways (and) the transformation it brought (in); I did not know this would happen. We have great telecom companies in India and even steel plants. Any time the government has entrusted the private sector, it has delivered. We have invested $16.5 billion in oil. There are 20 other companies that will come forward. (But) the change can come only if public sector reforms take place. Give independence to the public sector and let it be accountable. The previous government was a bit careful in supporting an individual (corporate) but this time, it will look at the nation to support a public cause.

Many companies are overleveraged and banks have tightened disbursals…
The world has been built with the help of leverage. If you do something wrong, like diverting money, you should be punished, but you can’t keep counting. If you hold a machine gun, you can’t keep counting the bullets when your aim is to conquer and finish the enemy. Similarly, when you talk about leveraging and non-leveraging, you have a higher objective to fulfil. We are looking at a country with 1.4 billion people; we need natural resource assets, we have to build infrastructure. In this process, people will go bankrupt, but this is part of the game. There is a lot of money available in the world. I have a feeling if oil production in India goes up only by 50%, the current account deficit will go away. Having said that, governance is very important and so is transparency.

How supportive has the petroleum ministry been in oil exploration projects where you bagged 41 blocks?
I can tell you one thing — I have never seen such support from the government being extended in this manner. Where bureaucrats hold back in giving clearances, they have come forward to take quick action by even monitoring how much production can be increased. I had not seen this awareness in the last 30-40 years. I hope the same awareness comes into the minerals sector too...

Is the minerals sector lagging?
Absolutely. In fact, I feel there should be one ministry for below-the-ground production (mining). Even if it’s oil and gas, there should be two different rules for mining of each. Make it very simple. And the biggest reform we need is getting forest and environment clearances and self-certification. Environment clearance is very important if you want to unlock value. Mr Modi is determined to give every clearance within three months.

On your overseas investments, what is Volcan's (Agarwal’s holding company) game plan for Anglo American?
We have 21% in Anglo. We are comfortable with it. I'm meeting their chairman and the management. We have learnt so much from them. They run the company well. Our whole intention was that in the effort to build India, Anglo will be very helpful because there is no other company in the world that better specializes in below the ground (mining) production than Anglo. Whether it is coal, iron ore, platinum, they understand it the best. My 21% will definitely help them come to India whenever the opportunity comes.
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