In a pre-budget discussion with Finance Minister Nirmala Sitharaman, representatives from various industry bodies suggested an increased focus on creating jobs, boosting public spending on infrastructure, and further rationalisation of taxes for the manufacturing sector and aid channelise funds into the green economy.
Worth mentioning here is that the suggestions came amid a review of the developments in the fluid global economic situation may have an impact on India.
“While overall, the Indian economy has done well, it is not immune to the global context. Global uncertainties and the global growth slowdown have already started to impact our exports, after a stellar performance last fiscal,” CII president Sanjiv Bajaj said while proposing a Rs 10 lakh crore target for capital expenditure for the next fiscal year.
The industry body proposed that the Centre consider an employment-linked incentive (ELI) scheme in the forthcoming budget for FY24, mentioning an urban employment guarantee programme, on a pilot basis first in metro cities.
“Further simplification, rationalisation, ease of paying taxes, and reducing tax litigation should be key priorities,” Bajaj said.
On Monday, FM Sitharaman kicked off customary pre-budget consultations with various stakeholders. The Budget 2023-24 is likely to be presented on February 1 during the Parliament’s Budget session. This would be the last full Budget of the National Democratic Alliance (NDA) government in its second term.
In its recommendations, Federation of Indian Chambers of Commerce & Industry (Ficci) asked for a focus on on physical, social and digital infrastructure.
A strong thrust on public capex will crowd-in private investment and give a boost to overall growth,” Ficci said, adding that with capacity utilisation in several sectors nearing 70 per cent there was strong indication of private investments picking up.
The industry bodies called for an income tax cut for salaried classes in order to boost demand and consumption in the economy.
“To further boost domestic demand and increase the disposable income in hands of people, personal income tax should be reduced at all levels,” Assocham president Sumant Sinha said.
CII recommended incentives could be given to particular industry groups such as tourism, logistics and retail to provide a further stimulus to job creation.
Earlier, the FM said the Indian economy is likely to grow around 7 per cent in next fiscal, emphasising that the budget will have to be “carefully structured” to sustain growth and curb sticky inflation.
