Mr. Hemant Kanoria
Chairman and Managing Director
Srei Infrastructure Finance Ltd.
I am sure that the Finance Minister is abreast of the present slowdown in the GDP growth and also that there is tepid investments in manufacturing and infrastructure in the country. There are several reasons for it, which the Government would definitely be working on to address. Our expectation would be to streamline the regulations which are creating hurdles for undertaking investments and also making the environment more tax-friendly. After the demonetization, introduction of GST and enactment of Insolvency and Bankruptcy Code, the industries and businesses are trying to grapple with so many changes at one time. It is important to deal with it with patience so that the business environment is not destroyed.
The specific suggestions would be the following :
(1) Power Distribution and Generation problems need urgent redressal.
(2) Banks need to be enabled to find solutions without referring all companies to IBC. Amicable and practical solutions to stressed assets need to be arrived at.
(3) Infrastructure Financial Institutions need to be encouraged and facilitated to lend to infrastructure sector so that the momentum in investments picks up.
(4) Simplification of Income Tax laws for easy compliance.
Mr. Devendra Kumar Vyas
CEO, Srei Equipment
With Central Statistical Office revising the gross domestic product (GDP) outlook for 2017-18 to 6.5%; all eyes are on the union budget to revive growth. Hon’ble Finance Minister Mr. Arun Jaitley has already mentioned that the focus of the upcoming union budget will be on spending on infrastructure and rural sector, and rightly so. Infrastructure investments have a huge multiplier effect as it raises the economy’s productive capacity by improving the supply-side efficiencies. They also have a snowball effect on the other core sectors like cement and steel. Infrastructure spending has a proven effect on increasing private investment and creating employment. To ensure that infrastructure spending remains on track, the government may want to relax the budgeted fiscal deficit target, while maintaining the delicate trade-off between fiscal deficit and growth. A lot of structural and financial reforms in the infrastructure sector are already underway. The budget should emphasize on those reforms which can act as a stimulus to reviving PPP investment in infrastructure. The Finance minister, during an earlier budget presentation, had announced a roadmap for cutting basic rate of corporate tax to 25 %. Although this was done for SMEs, an implementation across the board would encourage private investment and boost employment.
NBFCs, especially those dedicated to infrastructure financing, have been the silent contributors in nation building, because of their specialised focus and support towards bringing smaller entrepreneurs to the mainstream and making them bankable. The budget may address certain long-standing demands of the industry including exemption from the applicability of section 194A, and allowing tax benefits for income deferral u/s.43D of the Income Tax Act. Also the rider of minimum loan ticket size of Rs.1.0 cr for enforcement of security interest under the SARFAESI Act, applicable for NBFCs, may be evaluated to be done away with.
Construction equipment is a critical cog in infrastructure development. However, construction equipment is not given this benefit of higher depreciation rate when they are financed, instead the depreciation rate for such vehicles is only 15%. For other plant and machinery too, the rate is 15%. This negatively impacts infrastructure development. Also, to promote leasing on construction equipment, the GST on rentals of such equipment which is currently equal to the rate of GST levied on normal sales/purchase of that asset, may be reduced to 5%.
Managing Director, SPR Construction Pvt Ltd, Chennai.
2017 has been a great year for ushering transparency into the system with reforms like GST and Demonetization. Given the Make in India vision, the Government should also consider incentivising development of Wholesale Trading Zones across the country as they can be the first point of engagement for businesses across the world for goods manufactured in India. This is a huge opportunity area for the government and the private sector can play a very active role in partnering the Government in this initiative. China, the global sourcing hub, has such Wholesale Trading Zones in almost every city.
Mr. K. N. Radhakrishnan,
President & CEO, TVS Motor Compant Ltd.
The Indian economy is growing well. The structural reforms of the last few years has increased the ease of doing business and set up the country for further growth in the coming years. We look forward to this continuing.
Central Committee Member, CPI(M)
The Indian economy is in a slowdown. Despite the repeated spin, particularly in the aftermath of demonetisation, the Finance Minister Arun Jaitley had to eventually admit it in Parliament. The one dimensional obsession with GDP growth to showcase the health of the economy has failed the Modi government. The Indian economy is suffering when the global scenario has shown signs of slight recovery.
The reasons for the distress are both systemic and self-inflicted. The neoliberal trajectory is showing its limits with a massive growth of inequality and unemployment. Oxfam study shows a meagre 1% of the population has cornered 73% of the generated wealth. Official data shows, there has been a massive loss of employment, particularly in the informal sector, following demonetisation and the disastrous implementation of GST. Added to this, the agrarian crisis is ravaging the countryside and the banking crisis driven by cronyism is sucking the life blood of the economy. The way out is in radically refashioning the iniquitous tax regime and pump in major public investment in the budget to kick start the economy. Social sector spending, employment generation programmes should be the priority. Recovery if at all will have to be demand driven.
Leader, Indian National Congress
There is no emphasis on the manufacturing sector for the last few years. And with the introduction of GST, there is very little scope in enhancing revenue collection from various sources. The budget should emphasise on the manufacturing processes and on employment generation.