Govt is committed to making India’s tax regime stable and predictable, says Arun Jaitley #MakeinIndiaweek

“If I am going to bet on any country, it's India” – a statement made by John Chambers, Executive Chairman, Cisco, set the tone for the CNN Asia Business Forum 2016 at the ongoing Make In India Week in Mumbai.

The mega event is being organized by the Confederation of Indian Industry (CII) in partnership with Department of Industrial Policy and Promotion (DIPP) and the Government of Maharashtra in Mumbai.

The forum was attended by Finance Minister Arun Jaitley, along with industry leaders from across the world who gathered to discuss the potential for growth and business in Asia.

Speaking on the occasion, the Finance Minister said, “Innovation and services will bring jobs even as manufacturing turns high-tech. The nature of manufacturing and job creation itself will change. Government is committed to making India's tax regime stable and predictable.”

Highlighting the government’s ongoing reforms, Mr. Jaitley said, “Second generation reforms began two years ago to realise India's true potential. What we have realized is that unreasonable tax demands never bring revenue. In a federal system it is difficult to get states to surrender taxation power. As far as indirect tax regime is concerned, GST is the big tool; it will bring reform in the way we do business. Even if India's GST model is watered down, we have to start somewhere,” he added.

Speaking on the benefits of the Make in India Week, Mr. Jaitley stressed that the importance of making in India will only be realized when it’s benchmarked to the world. While making in India has got it’s impetus from the Modi government, infrastructure is an obstacle on the road to manufacturing. Lack of good infrastructure makes it difficult for businesses to operate. The Finance Minister said that the government has covered a huge distance in terms of infrastructure – be it ports, highways or rural networks, and has increased public spending in the past few months.

The government is concentrating on infrastructure in a big way. Railways and highways have been net beneficiaries of public spending while sectors like power have benefited from private investment. In the months to come, rural reforms will also be taken up.

Speaking on agriculture, Mr. Jaitley observed that agriculture is one sector where investment yields faster results. “Investment in this sector has been relatively less in the past but the government is now focusing on areas of investment in agriculture - on rural roads, electrification and irrigation,” he said.

Speaking of ailing public units, the finance minister said that the State will not get out of the banking business. Addressing the question on the need for their existence, Mr. Jaitley said that these banks are important for the purpose of geographical reach. However, these banks and their boards have to be professionalized. “Digital technology should be used to remove income inequality.”

Exploring new ideas, technology and leadership skills that will shape India’s economic and social future, Cisco’s John Chambers said, "Every company in this world will become a tech company. 40% of today's non-tech companies will disappear in the next 10 years. Eighteen months ago, I said if you want to bet on one country, it is India as the country is in sync with the speed of innovation in the current digital age. Anticipating the market and adapting to change in market dynamics, India is moving at a fast pace in the digital era. Regardless of political divides, Indians have to come together for growth. If you still haven't invested in India you may miss the bus.”

Sharing his views on the government’s campaign ‘Make in India’, Anand Mahindra, Chairman, Mahindra Group, said, “Make in India is not a mandate but a rallying cry. The government is trying to draw attention of investors. All I say is that you cannot mandate innovation. All the government needs to do is put in regulation and institutions, and then leave the rest to business. Speaking of the possible impact of an increase in manufacturing on the environment, Mr. Mahindra observed that more investments are going to flow into companies that are carbon neutral.

“India is a highly innovative place,” said Banmali Agrawala, President & CEO, South Asia, GE, speaking on behalf of a manufacturing pioneer which is creating jobs and building factories around the globe. “We're pressing the pedal on getting digital.”

Throwing light on the investment climate of the country, Kumar Mangalam Birla, Chairman, Aditya Birla Group said, “We as a country are highly innovative. It is part of our DNA. We have a government here which is focusing on more on manufacturing than ever before. The government wants to be a catalyst through its ‘Make in India’ initiatives. Today, several new opportunities have opened up for the private sector in India, which cannot be ignored.”

(Image credits: BCCL)