India Inc to FM - Forget nuts & bolts, focus on the big picture

Last Updated: Wed, Feb 27, 2013 06:16 hrs
Economy to grow closer to 5.5%: PC

India Inc expects Finance Minister P Chidambaram to focus on the big picture in the Union Budget. CEOs say they would like the FM to push tax reforms, give a road map for the Goods and Services Tax (GST) rollout, provide investment stimulus to the slowing economy and take steps to control the fiscal deficit.

In a survey by BS reporters across India, a majority of the 25 CEOs who responded said they expected the FM to introduce amendments to the I-T Act which would reduce litigation in tax disputes between firms and the revenue authorities. On transfer pricing, a majority said there was need for more clarity on share valuation and other issues in the wake of the proposed $10-billion adjustments in the recently concluded transfer pricing audits.

The GST rollout should be on the top of the agenda, said CEOs. The road map for it would go a long way in assuring investors the government was serious about tax reforms, said Arun Nanda, director, M&M.

With dwindling order books and few new projects being announced, companies expect the Budget to raise infra spend. "I expect a 8-10 per cent rise. It should be $100 billion to boost the economy," said Ravi Uppal, MD & CEO, JSPL .

What is worrying corporate leaders is a drift in the government, due to which big projects are not being announced. "We have frozen India investments due to lack of policy direction. The Budget should give an investment stimulus," said the CEO of a conglomerate.

"Policy initiatives have been good. But, the air of uncertainty needs to be removed and implementations need to take place quickly, so that investments can happen in these sectors," said Harsh Chitale, CEO & whole-time director, HCL Infosystems.

"The economic growth is getting hit due to fiscal deficit. The government has taken steps with partial diesel decontrol, but we expect more to contain subsidy on fertiliser, food and oil," said N Srinivasan, finance director, Murugappa Group.

More from Sify: