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India Inc pitches for continuation of reforms, tax stability to boost up India's economy

BNE ADMIN


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New Delhi: India Inc today pitched for the continuation of reforms while ensuring tax and policy stability in the forthcoming Budget to prop up the economy hit hard by the COVID-19 pandemic.

In the virtual pre-Budget consultation held with Finance Minister Nirmala Sitharaman, industry chambers said that government market measures will help entrench the nascent recovery being currently seen in private investment.

Capital expenditure by the government through enhanced infrastructure spending should the meantime continue to support growth, CII President TV Narendran said.

"Infrastructure sector with a multiplier impact on rest of the economy requires interventions, especially to improve and diversify sources of financing. In this context, it is suggested that government should consider developing the municipal bond so that urban local bodies can raise funds for investing in infrastructure," he said. Meanwhile, Assocham suggested extending the 'Vivad Se Vishwas' scheme for highly regulated sectors like telecom, power, and mining, as also a dispute resolution scheme for issues related to customs.

"We appreciate the government for the Vivaad se Vishwas scheme which has gone a long way in reducing the long-pending litigations and resulted in greater success.

"Several infrastructure and service sectors such as telecom, power, mining, etc., which were privatised to drive investment and growth, are highly regulated/licensed," Assocham President Vineet Agarwal said.

Hence, there are many legacy court cases, often arising from the interpretation of regulations/policies, Agarwal said,
adding, these cases drag on for 10-15 years.

Given the condition of imposition of penal rates of interest, penalties, and interest on penalties, by the time these cases are decided, the due amounts may become 5x to 6x of the disputed principal amount, he added.

The meeting was also attended by Ministers of State for Finance, Pankaj Chaudhary, and Bhagwat Karad.

Finance Secretary TV Somanathan, Economic Affairs Secretary Ajay Seth, Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey, and Principal Economic Adviser Sanjeev Sanyal were also present, besides other senior officials, in the meeting.

During the meeting, Ph.D. Chamber demanded the extension of relaxation with regard to Performance Bank Guarantee (PBG) and Earnest Money Deposit (EDM) for one more year.

During the pandemic, the government had relaxed the percentage of performance security from 5-10 percent to 3 percent and eased the Earnest Money Deposit (EDM) requirement till December 31, 2021.

Source- PTI

BNE ADMIN