▲ Up
 
21:45 25-09-2016
MAIN АКИpress CA-News
About us On-line subscription
KazakhstanKyrgyzstanMongoliaTajikistanTurkmenistanUzbekistanWorld
POLITICSBUSINESSINCIDENTSSOCIETYCULTURESPORTANALYSISSCIENCE
India's new government unveils reform budget

Bishkek (AKIpress) - India's Narendra Modi-led government has unveiled incremental measures to boost capital spending in Asia's third-largest economy in its maiden budget, and reassured foreign investors that they will be treated fairly, the IBT reports.

The neutral budget, tabled in the lower house of Parliament on 10 July by Finance Minister Arun Jaitley, has raised the limits on foreign investment in defence and insurance sectors from 26% to 49% through the Foreign Investment Promotion Board (FIPB) route which makes sure investments undergo strong scrutiny.

However, the budget continued to prevent non-residents from assuming majority control in projects that can supply weapons to India, the world's leading arms buyer.

Retrospective Taxation

The budget said the government will constitute a high-level committee to review retrospective tax claims blamed for obstructing foreign investments into India, particularly after firms such as Britain's Vodafone were served with massive tax demands.

Jaitley sought to reassure investors by promising a stable tax regime and said the government will not "ordinarily" create new liabilities retrospectively.

He, however, stopped short of ditching the 2012 legislation on retrospective taxation.

Vodafone and India have been embroiled in a multi-billion dollar tax row for over six years, ever since the British firm acquired Hong Kong-based Hutchison Whampoa's Indian mobile assets in 2007.

Jaitley said that ongoing disputes over retrospective tax claims at various courts and "legal fora" will "naturally reach their logical conclusion."

The 2012 legislation overturned a Supreme Court judgment which dismissed Vodafone's tax demand earlier that year.

Deficit Target

Jaitley, in his budget speech, said he had "accepted" the "daunting" budget deficit target of 4.1% of gross domestic product (GDP) for the financial year ending March 2015. The 45-day-old Modi regime inherited the target from the previous Congress-led coalition government.

Dinesh Kanabar, Deputy CEO, KPMG India, said the finance minister's pledge to stick to a fiscal deficit target of 4.1%, against a backdrop of an oil crisis and poor monsoon rains, while 'commendable', appeared 'a bit ambitious'.

GST

Jaitley also said the government hopes to roll out a landmark tax reform to merge India's 29 states into a common market, by December 2014.

Jaitley added that New Delhi will be "more than fair" in its dealings with India's states about how revenue will be allocated under a new GST regime.

Economists have said that the proposed nationwide goods and services tax (GST) will boost revenue, while making it easier to do business in the sub-continent.

Shubhada Rao, chief economist, Yes Bank, said in a note: "Fiscal consolidation is a strong takeaway. The FDI in insurance and defence and the plethora of schemes for improving the rural economy with all round focus on development programmes, are a key thrust. It's a good beginning.

"For the 4.1% target of the fiscal deficit, the heavy lifting may be done by PSU disinvestment and non-tax revenue streams."

Dinesh Thakkar, chairman and managing director, Angel Broking, said: "...Infrastructure, real estate [and the] finance sectors were amongst the biggest winners, with measures to improve funding availability to infrastructure and low-cost housing and providing a boost to REITs and bank infra lending...."


Twitterfacebookprint
17:15 10.07.2014
LATEST NEWS
19:00 Vice PM Jenish Razakov familiarized with bank protection works in Talas18:20 Tashkent calls UN donors to honor commitments to Afghanistan17:41 Health insurance for foreign travel in Kyrgyzstan leaves much to be desired – Health Minister17:21 Vice PM Gulmira Kudaiberdiyeva to head delegation of Kyrgyzstan at V Baku International Humanitarian Forum17:06 Trump campaign plans $140 million ad buy17:00 Moody's downgrades Turkey's credit rating to 'Junk' status16:50 Tariff policy of mobile operators leads to refusal of subscribers from traditional telephone operator services16:16 Kyrgyz government asks Parliament to urgently consider bill on lotteries15:51 Government approves agreement between Education Ministry of Kyrgyzstan and Ministry of Human Resources of Hungary15:27 Saudi Arabia to provide $3.7 million grant to Kyrgyzstan for construction of hemodialysis and heart disease centers14:22 FMs of Kyrgyzstan, Kazakhstan, Tajikistan, Turkmenistan, Uzbekistan meet in New York13:59 Obama Veto Bars 9/11 Lawsuits Against Saudi Arabia13:20 Foreign Minister Abdyldayev hold series of talks on sidelines of 71st UN General Assembly session12:42 Kyrgyzstan signs Paris Agreement12:23 ADB, Tajikistan agree on new 5-year partnership strategy to promote growth12:10 Google may buy Twitter - report11:43 Pilot project on separate waste collection launched in Bishkek schools11:26 18-year-old boy beaten to death for talking to girl in Osh10:56 Uzbekistan gains 55th place in world health ranking ahead of all Central Asian countries10:36 Government agencies of Kyrgyzstan improve work on combating torture recent years — Vice PM
Astana
+17° C
Ashgabat
+34° C
Bishkek
+22° C
Dushanbe
+27° C
Tashkent
+31° C
Ulaanbaatar
+12° C
exchange rates
 
76.77
68.53
10.27
1.07
378.29
337.37
50.58
5.30
6.85
6.26
1.01
0.12
3286.53
2888.39
446.81
42.81
3.93
3.50
0.52
0.05

© AKIpress News Agency - 2001-2016. All rights reserved
Republication of any material is prohibited without a written agreement with AKIpress News Agency. Any citation must be accompanied by a hyperlink to akipress.com.
Our address:
Moskovskaya str. 189, Bishkek, the Kyrgyz Republic
e-mail: english@akipress.org, akipressenglish@gmail.com;
Tel/Fax: +996(312)90-07-75