o Reforms in taxation, foreign direct investment, labour laws, land acquisition, banking laws, disinvestment and so on to promote private investment need to be continued and made smoother
o Govt needs to continue repeal of obsolete laws and regulations to improve ease of doing business and reduce compliance burden.
In a memorandum to the PM, Dr Vijay Kalantri, Chairman, All India Association of Industries or AIAI congratulated Shri Narendra Modi on becoming India’s Prime Minister for the 3rd time and expressed hope that reforms in various sectors will continue or even pick up speed in order to empower all segment of business class especially MSME and agri sectors. AIAI urges the govt to promote research & development and investment in agriculture sector to enhance productivity, diversify cropping pattern and increase farm productivity. Dr Kalantri is of the opinion that the rural economy needs substantial support by reforming MSP system, increasing investment in agriculture, post-harvest infrastructure, skill development, food processing parks, rural roads and power connectivity. These measures will increase employment opportunities in rural areas and stimulate growth in rural wages.
In order to fulfil the Hon’ble PM’s vision of making India the 3rd largest economy before 2030 and a ‘Developed Economy’ by 2047, India needs streamline central, state and local government regulations that are increasing the cost of doing business, especially for MSMEs who operate on thin margin and are unable to compete at a global level. Says Dr Kalantri, “The new government may continue with its reform agenda especially in areas such as labour laws, environmental clearances, single window clearance and investment aftercare to improve attractiveness of investing in the country. Also, there is a need to continue public investment in infrastructure, ports, railway and road connectivity, industrial corridors to reduce logistics cost.”
The memorandum submitted to the PMO also spells out in detail the steps to be taken to improve skilling and employability, boost Women-led economic development, establish mechanism to turnaround sick MSME units that have the potential to grow, promote credit to the MSME sector, upgrade power transmission and distribution infrastructure to reduce average electricity tariff, implement sweeping tax reforms including bringing power, fuel and other left over sectors under the GST regime, simplify capital gains tax structure and TDS structure as also create a consolidated fund for municipal bodies and transfer tax revenues to these local bodies.
Adds Dr Kalantri, “In the next 5 years, the govt also needs to work out ways and means to reduce import dependence for energy, expedite passage of pending bills such as the Insurance Amendment Bill, National Financial Information Registry Bill, Insolvency and Bankruptcy Code Amendment Bill, Drugs, Medical Devices and Cosmetics Bill and so on.”
AIAI in its memorandum has also laid out details for finalizing rules for Digital Personal Data Protection Act, stepping up privatisation especially of public sector banks, revamping SEZ policy, strengthening Industry-Academia collaboration, facilitation of Technology Transfer,
conducting next socio-economic census to identify economically backward households for targeting government subsidies, reducing Import dependence for edible oil, reforming trade policy, correcting the inverted customs duty structure where imports of finished goods is taxed at lower rate than import of intermediate goods, which discourages local manufacturing as well as promoting formal jobs in the industrial sector by facilitating investment in labour-intensive industries such as food processing, textile, construction, real estate, tourism etc.
These measures will revive private capital expenditure, investment and job creation in the medium to long run. India is also favourably positioned to attract foreign investment as it is the beacon of growth and stability in this uncertain global geopolitical order.
More info at: www.aiaiindia.com
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