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The objective is to see how to make life easier for people who invest in India: M Damodaran


The Ministry of Finance had recently set up a committee under former Sebi chairman M Damodaran to look at ways to increase private equity and venture capital investment in India. It also comes at a time when we are seeing large-scale layoffs at startups across the country.

Addressed exclusively to CNBC-TV18 at the launch of industry body FICCI’s Model Risk Code, the former chairman of Sebi spoke about ways to increase investment in private equity and venture capital in India, lessons learned from layoffs in startups and regulatory changes needed to make it easier to do business.

On the need for parity in taxation, Damodaran said, “We have had input from a lot of people, the committee itself has considerable expertise drawn from the resources. We are looking at all of that, our focus is to see how to make life a little bit easier for people who actually invest in India.This is certainly one of the requests that the committee has received and is responding to.

Regarding the ease of doing business, he said that India needs to check whether the context of certain laws and regulations has changed since the introduction of the laws.

He said: “Certainly you have to look at all the existing regulations and laws and see if any of them are past their expiry date, have lost their relevance. Because you are writing laws and regulations in a context, has the context changed ” Of course behind all this we have to bear in mind that India needs to see a lot of investment from outside India . So how are you going to make things a little easier? That’s exactly what we’re talking about.”

Talking about lessons learned from layoffs in startups, Damodaran said companies need to do scenario analysis and scenario planning.

He said: “In good times you obviously think this will go on forever. There will be challenges that will come from outside, challenges from outside of your business when I say outside of the ecosystem, but outside of your business, and you have to see how you address those.”

He added that if you don’t predict a bad day and you think the sun will shine everywhere, then clearly the business model has weaknesses. Every business should have fallback options instead of solving problems when they arise.

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