Get set and go

The forthcoming budget is more important for the NDA government than the previous two, as it’s now almost midway through its five-year tenure and can no longer afford to take citizens for a ride. Though there is little noise so far, almost every section of the society has huge make or break expectations from this year’s budget.
Badly stung by high prices, the common man is deeply concerned about his meals and the cost of running the household on everyday basis. Employees are desperate for more disposable incomes and are seeking significant exemptions on income-tax. Businessmen want enough low cost capital, while startups are seeking a good ecology that makes doing business easier. Though startups have already been granted three-year tax break, its meaningful impact is doubtful in a short timespan. Flipkart, one of biggest startups in our country, is yet to book profits after being around for so many years.
There is no denying that all business tycoons are pinning hopes on this budget to lower taxes to boost economic outcomes. The irony is that even after almost seven decades since independence, only 3 per cent of the population pays income tax, and that too mostly from the Rs 3 lakh to Rs 5 lakh income group.
If I can buy a toothpaste online sitting in my bedroom, why can’t the income-tax department go online to tackle tax delinquencies more efficiently, I wonder. It’s time for many more of us to pay taxes. Embracing technology would certainly benefit both the government and the taxpayer.
Last night, I was talking with my journalist friend in Kashmir and he raised a very important point about rural economy, which is often neglected. There is immediate need to revive the rural economy that sustains close to 70 per cent of our population


Reforming India

We are busy in celebrating ‘Make in India’ week. Though it began on a bad note with a massive fire, it is, nevertheless, expected that the event would finally achieve its objective of attracting huge foreign investments. Yet, it is the government’s foremost responsibility to ensure the easy availability of credit to help startups take off without hindrance. Only then can manufacturing growth pick up.
Meanwhile, we are approaching to the announcement of the Union budget. It is necessary for the government to also push through the long-awaited goods and services tax (GST) in the forthcomings session, trigger the revival of investments in the infrastructure sector and improve the ease of doing business quotient, besides initiating land and labour reforms for Make in India to succeed. However, given the current political climate, GST is unlikely to materialise anytime soon. So, the government must immediately shift focus to address land and labour issues, which are in the state list. ‘Make in India’ cannot be dictated from Delhi; most of the action must happen at the state level. Competition among states to attract higher investment has spurred easier business rules at the state level, as is the case with Gujarat, which tops in ‘ease of doing business’.
Currently, the biggest challenge to ‘Make In India’ lies in reforming the archaic labour laws that are an impediment to higher productivity and employment generation in the labour-intensive manufacturing sector. At the same time, workers’ unions have accused the NDA of being partial towards industrialists. The government must disprove this through relevant progressive changes. The labour ministry has to play an important role in consolidating labour codes on industrial relations, social security, wage and workers safety. Lack of skills or job-readiness erodes the competitiveness of an economy and affects productivity. Making India’s young demography job-ready is equally important for the success of the ‘Make in India’.

Let’s do it

As the ‘Make in India’ initiative celebrates its first anniversary this weekend, all eyes are focussed on our prime minister Narendra Modi’s scheduled interactions with global honchos, including those from Germany and Japan.
India must make the right pitch for the ‘Make in India’ story to the nearly 1,500 delegates from foreign companies to attract investments so that the initiative can truly move forward.
The worrying trend right now is the low investment in manufacturing that has a bare 16 per cent share of the GDP. We must make every effort to raise this to at least 25 per cent. Initially the ‘Make in India’ campaign week will focus on only 10 key sectors, including pharmaceuticals and information technology.
Lately, several foreign companies have evi­nced interest in Hyderabad-based pharmaceutical and biotech company Bharat Biotech that gained global traction for claiming to work on an antidote to zika virus. If it really works, Indian research would arrive on the world stage.
In the recent past, mobile handset companies started assembling mobile parts in the country, giving a good start to the ‘Make in India’ initiative, but still, lots need to be done to start exporting these handsets, which, right now looks to be a tough job.
Since there has been some dampening in the investment climate, the government needs to equally stress on higher public investment; for this, a lot would depend on the upcoming budget. Reviving the investment cycle would definitely be a big challenge.
If India continues to ride the wave of entrepreneurship, then time is not far, when these new initiatives would transform the country into a developed economy.