Industry Leaders Seek Lease Reforms in Union Budget 2024

21 June 2024

Industry leaders requested a host of considerations in the upcoming full Union Budget 2024 during their pre-Budget meeting with Finance Minister Nirmala Sitharaman on June 20. Expectations listed by India Inc. during the two-hour interaction include a reduction in the income tax burden for the common man, an increase in capital expenditure, and measures to control food inflation, PTI reported.

Prominent industry figures, including Sanjay Aggarwal (President at PHD Chamber), Vinod Aggarwal (President at SIAM), Neeraj Akhoury (President at Cement Mfrs Association), Sanjay Kirloskar (CMD of Kirloskar Brothers), Arathi Krishna (MD of Sundram Fasteners), Shefali Misra (Vice President at Biocon), Yash Pal Sachar (Vice President at Ashok Leyland), and Samir Somaiya (President at IMC Chamber), and others, made recommendations for the Union Budget.

We Take a Look At What India Inc. Expects

Emphasis on Infrastructure Development: During the pre-Budget consultation, industry leaders and associations called for a greater focus on infrastructure development to sustain economic growth.

Support for MSMEs: The industry highlighted the importance of bolstering the MSME (micro, small, and medium enterprises) sector, which is considered a backbone of the Indian economy and a key employment generator.

Licensing under focus: Vivek Jalan, Chairman of National Fiscal Affairs and Taxation Committee of the Bengal Chamber of Commerce and Industry, suggested easing licensing requirements for electronics imports.

Labour codes for competitiveness: PHDCCI made recommendations on implementing the four labour codes to enhance industry competitiveness and strengthen university-industry linkages for R&D. “We have suggested labour reforms for industry’s progress, we want the tax (rates) to be same. We have suggested that MSME NPA timeline be extended to 180 days from 90 days at present to provide relief to the sector,” Aggarwal of PHDCCI told PTI.

Factors for consideration: Samir Somaiya of IMC Chamber highlighted the need to consider geopolitical factors, the pandemic’s impact, and climate change in shaping India’s economic future, particularly in terms of green growth. “We looked at in the context of the last few years of the geopolitics, the pandemic, we have managed to steer our economy well but now to look at the future, in the context of climate change how can we have India’s growth in the face of a green transition and also fueling the growth with green resources,” he said.

CII Presented Eight Points for Consideration

Sanjiv Puri, President of industry body Confederation of Indian Industry (CII), presented eight points to Sitharaman for consideration. These included relief in income tax for lower income slabs, streamlining employment-linked incentive schemes such as the Production Linked Incentive (PLI) scheme, and promoting ease of doing business. CII also made recommendations for agriculture and rural development.

FICCI’s Focus on Capex and Tax Simplification

Trade association, the Federation of Indian Chambers of Commerce & Industry’s (FICCI) recommendations centred around driving capital expenditure, fostering innovation, and simplifying taxes. Former FICCI President Subhrakant Panda emphasised the need to support growth momentum by energising demand, enhancing infrastructure development, controlling food inflation, supporting MSMEs, and prioritising innovation and R&D. “We touched upon broader issues (like) primarily what can be done to maintain India’s growth momentum and impart further impetus to it. So broadly private sector capex is picking up and the numbers are very encouraging in this regard,” Panda said after the meeting.

Assocham’s Confidence in Government Strategy

Advocacy group Assocham (Associated Chambers of Commerce and Industry of India) expressed confidence in the Modi 3.0 government’s strategic focus on capital expenditure, particularly in infrastructure, education, and healthcare. “We welcome the government’s emphasis on fiscal consolidation and believe it would proceed with a strategic focus on increasing capital expenditure. By prioritising investments in infrastructure, education, healthcare, and other critical sectors, government can stimulate economic growth while maintaining fiscal discipline,” President Sanjay Nayar said.

This was the third pre-Budget consultation held by Sitharaman and senior ministry officials. Earlier in the day, the finance minister discussed the Budget with financial sector players. On Wednesday (June 19), she held pre-Budget meetings with economists. The full Budget 2024-25 is expected to be presented in Parliament next month. (With inputs from PTI)

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What are India Inc.s expectations for Union Budget 2024 discussed with Nirmala Sitharaman?

India Inc. anticipates Union Budget 2024 to focus on tax reforms, infrastructure investment, and incentives for digital innovation. Industry leaders have urged Finance Minister Nirmala Sitharaman to prioritize ease of doing business, boost manufacturing, and enhance export competitiveness.

Can the Union Budget 2024 reduce the income tax burden for the common man as requested?

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