LI Network
Published on: January 31, 2024 at 16:22 IST
The Confederation of Indian Industry (CII) has put forth a proposal suggesting the creation of a comprehensive Ministry of Investment as part of its recommendations for the interim budget, aiming to reshape the country’s economic landscape.
The envisioned ministry would serve as a centralized point of contact, streamlining and facilitating investment opportunities both within India and abroad for Indian investors.
The proposed measures are part of the CII’s extensive set of proposals, acknowledging the geopolitical uncertainties of the current times.
The primary objective is to achieve balanced, sustainable, and broad-based growth, aligning with India’s vision of becoming a developed nation by 2047.
Chandrajit Banerjee, the Director General of CII, emphasized the importance of maintaining a balance between economic growth and fiscal consolidation, urging the government to adhere to the fiscal target of 5.9% for the current year and aim for further consolidation to around 5.4% for FY25. He stressed the need for specific measures to boost revenue and rationalize expenditures in achieving this goal.
In addition to the proposal for a dedicated Ministry of Investment, the CII recommends a focus on promoting accessible and affordable housing, particularly emphasizing the Pradhan Mantri Awas Yojna-Grameen (PMAY-G) and Pradhan Mantri Awas Yojna-Urban (PMAY-U). This dual-focus initiative reflects a holistic approach to fostering economic growth while addressing critical housing needs.
The CII’s proposals cover various aspects, including increased allocation for rural schemes like Pradhan Mantri Gram Sadak Yojana (PMGSY), expedited wage payments under Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), and a push for agricultural warehousing to reduce wastage.
Revenue augmentation suggestions include the continuation of tax simplification and rationalization, signaling the next set of Goods and Services Tax (GST) reforms, and an aggressive focus on meeting disinvestment targets. The CII also recommends simplifying tax deduction at source (TDS) rates and reducing categories.
On the expenditure front, the CII suggests rationalizing food and fertilizer subsidies without impacting deserving beneficiaries, using current data for better targeting in the food subsidy program, and moving towards direct cash transfer to farmers for fertilizer subsidies.
These proposed measures, if implemented, could create space for the government to support sustainable growth by increasing capital expenditure by 20% to Rs 12 lakh crores. The CII’s recommendations also address the importance of boosting disposable incomes, employment generation, and leveraging India’s demographic advantage.
In the area of trade, the CII suggests rationalizing import tariffs, setting up a dedicated Trade Promotion Body, and focusing on technology, research and development (R&D), and Artificial Intelligence (AI) as key drivers for growth.
The proposal also emphasizes sustainability, suggesting the creation of a Green Transition Fund of India to finance green projects, and calls for increased public expenditure on health and education, with a focus on private sector engagement through Public-Private Partnerships (PPPs).
The comprehensive set of recommendations aims to contribute to India’s economic development and resilience amid evolving global challenges.