Need simpler GST regime, stable policy setting:
Sumant Sinha, Assocham President
India needs a strong contract-enforcement agency, a
simple GST regime and simplified taxation process along
with a stable policy environment to significantly
improve ease of doing business, said Sumant Sinha, the
newly elected president of Assocham.
India’s economy is poised
for sustained high economic growth in coming years, he
said, while flagging another Covid-19 wave and the
Russia-Ukraine as possible risks.
Sinha, who is chairman and
managing director of ReNew Power, took charge as
president of the industry body on Monday. Also, Ajay
Singh, chairman and managing director of SpiceJet, took
over as the new senior vice-president of Assocham.
“After Covid impacted economic activities for a year and
a half, there has been a very nice bounce back and the
expectation for next year’s GDP growth is about 7.5-8%.
The number of reform measures that have been undertaken,
robust exports and controlled inflation will ensure that
the momentum is going to carry through into next year
and beyond,” Sinha told ET in an interview.
Sinha, however, cautioned about the impact of the
external environment on India’s growth story. “Having
said that, of course, in all of these situations, there
are always some risks to growth as well. One of those,
of course, is the external environment, where there is
some degree of uncertainty because a conflict is going
on,” he said.
“The second thing is, of course, Covid itself. Hopefully
we have seen the last of Covid but that is something we
have to wait and watch,” he said, adding that the
economy was in a very robust shape right at present and
that he could foresee several years of sustained high
Commenting on the delay in contract enforcement under
infrastructure projects, Sinha vouched for setting up of
a central contract-enforcement authority.
“There needs to be a central contract-enforcement
authority, to be set up by the central government and
staffed by people chosen by a central mechanism. This
body should be able to make decisions relatively soon on
judgements and issues like this,” he said.
Laying the roadmap for India to further improve on the
ease of doing business ranking, Sinha said multiple GST
rates and cumbersome taxation process were some issues
that needed to be resolved to help India be in the 20s
or 30s as against its current position. India was 63rd
in the last report of the World Bank.
“Corporate taxation is a complicated and a cumbersome
process. It needs to be simplified a little bit while
focus should also be on speeding up the entire
bankruptcy process,” he said.
On the GST front, India needs a more stable policy, he
said. “There should be a flat GST for everything, and
there should be no discretion of the GST Council on
tweaking numbers up and down so that nobody has any
doubt or any issue and there is a very predictable
environment,” he added.
Talking about India’s dependence on China for solar
equipment, Sinha said the government was now focusing on
the security of equipment supply so there was no
external dependence there.
“The government is very focused now on trying to
indigenise and localise the supply chain, which is
absolutely the right thing to do. It also gives India
the opportunity of developing as an alternative
manufacturing hub to China,” he said.
“Given this whole energy security issue, a lot of
countries around the world would be happy to buy from
India, rather than from China, because it’s good to
have, for them also, some diversification,” he added.
Sinha also emphasised on the need for further tweaking
the definition of MSMEs, enhanced credit provisioning
for them and greater technological support to MSMEs to
help them build up scale of operation.
“A lot of Indian MSMEs are basic assembly or simply
basic product manufacturing. We need much more hi-tech
development so that eventually over time it can lead to
higher quality products and more R&D in the country as
well,” he added.
Source:::THE ECONOMIC TIMES,