THE new companies bill 2009 will take a special approach to second and third generation family members joining the family run companies after their studies, the union minister of state for corporate affairs, Salman Khurshid said here on Saturday.
“With more number of generation next joining the services of such companies, we need to facilitate them by providing guidelines. We need to train them in following good corporate governance,” the minister said addressing a session on “Innovision 2010,” organised by CII coinciding with its annual general meeting of southern region in Chennai.
Mr Khurshid said the government is firm on the transition of Indian companies from GAAP (generally accepted accounting principles) to IFRS (International financial reporting standards). “We are on schedule on convergence with IFRS from 2011,” he said. (ICAI has proposed it on or after April 2011).
At the same time, he said while the large corporates will be able to adopt the international standards, there is need to apply to calibrated regulation in the case of smaller companies (SMEs) in view of the compliance cost. They will have the option to adopt it, he said. He said with Mahatma Gandhi’s ideas finding relevance even in the 21s century, the government wants to come out with a new development model of CSR based Gandhi’s ideas for Trusteeship.
The minister said despite the high share (35%) of household savings, only 1.5% of it is invested in capital market. In view of this, the government has taken up a massive investor education programme in different languages. He wanted the corporate sector to support inclusive growth so that an average Indian will participate in the enchanting India growth story. Similarly, the farmers should not be left out of the growth story. More than contract farming, they should be initiated into the corporate structure to do things more efficiently.
Earlier, minister for textiles, Dayanidhi Maran said the liberal era has produced thousands of Birlas and Tatas. “The private sector companies are driving our growth. They are faring well and leading the nation,” he said.
The textile sector is the most liberalised sector and a number of private entrepreneurs are betting big on huge domestic market. The government is considering labour reforms to attract more investments and achieve high growth in the sector.
Mr Maran said the if the country has to achieve 8 to 10% GDP growth as envisaged by the Prime Minister, the power sector has to grow at 22 to 25%. This called for more investments in the sector. Stating that industries in Gujarat are flourishing due to CNG, he said the Centre is taking all steps to help Tamil Nadu get natural gas from Godavari basin.
CII president, Venu Srinivasan said there is a wide optimism on India emerging as the third largest economy and becoming a $5 Trillion economy in five years, it can be achieved only by boosting India’s share in world trade and replicating the innovations done in the IT and biotech sectors in the manufacturing and agriculture sectors. The farmers’ condition would not improve with free power supply and farm subsidies. Gujarat has achieved a CAGR growth of 8% in the last 5 years in the agri sector by ensuring 18 hours of power supply. If corporate farming is encouraged it will lead to better quality, marketing and delivery.
