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Ficci praises Modi govt’s 1st year

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New Delhi, May 25  Praising the initiatives the Modi government has taken in the past one year, Ficci today said it would take 18-24 months for results to be visible on the ground, even as the industry body noted that improving India’s ranking in ease of doing business index is a “tall order”.

Ficci President Jyotsna Suri said the Modi government in its first year in office had sparked a positive sentiment, restored investor confidence and established Brand India.

“Prime Minister’s extensive international travels have brought a positive focus to India. Today, India’s macro-economic performance is far better than what we had one year back.

“GDP growth has improved, inflation is considerably lower, fiscal and current account deficit are under control and we are seeing an influx of foreign investment into the country.” she said in a press conference.

Suri, however, said it is a “tall order” for the government to improve the country’s ranking on the World Bank’s ease of doing business index.

India is ranked 142 in ease of doing business index.

Government has taken several steps to improve ‘ease of doing business’ in the country.

“An action plan has been proposed for improvement in the regulatory environment and improving ease of doing business,” Finance Minister Arun Jaitley had said earlier.

The seeds of development have been sown and it is just a matter of time when we shall reap the fruits of all these efforts, Suri said.

Comparing expectations from the Narendra Modi-government to “pregnancy of an elephant”, FICCI past president R V Kanoria said it will take 18-24 months time for results of measures taken to be visible on the ground.

Asked whether tax terrorism was still a worry, Kanoria said: “It is something which is deep- rooted which needs to be rooted out. It is bound to happen if there is a desire and a will at the top, which is quite apparent that it is. Till that time when one sees it really happen on the ground, there will be talk about it.”

Referring to the government’s move to form a panel to look into the controversial issue of levy of Minimum Alternate Tax (MAT) on FIIs, Kanoria said: “The tax department is implementing the law and there are judgements on MAT which say that the tax department can actually raise the demand.

“But it does cause problems with investor confidence because any money which was not routed through tax havens actually gets taxed. So the perception becomes that the honest taxpayer actually is the criminal. I think there is a desire to correct this.”

“Tax terrorism can only stop if complication in the law is reduced, if exemptions are done away with, discretion goes out of the system, because there is still too much discretion.

I think these are areas which will get tackled,” he added.