May 31, 2019
PHDCCI hails new Union Cabinet, expects revitalization of economy and job creation
While congratulating the new Cabinet of the Modi Government, industry body PHDCCI said in a press statement issued here today, that revitalization of economic growth, measures for job creation and doubling of the farmers’ income should be top of the Agenda of the new government.
Manufacturing should become the engine of economic growth supported by the growth vehicles viz. public investments, private investments, private consumption and exports, said Mr Rajeev Talwar President, PHD Chamber of Commerce and Industry.
Bolstering of the Manufacturing Sector should require structural reforms in the labour laws. The low hanging fruit at this juncture, is to convert 44 labour laws into 4 Labour Codes. The objective should be to make labour laws simple and easier. Allowing the Fixed Term Employment would be crucial to increase efficiency and efficacy of the business firms in the domestic as well as in the export markets, said Mr Talwar.
Land reforms such as increase in the lease period and creation of land banks for the use of industry would be crucial to enhance the production possibility frontiers of the manufacturing firms and to achieve a 12% growth rate in the manufacturing sector, he said.
Reduction in the cost of capital at this juncture, becomes crucial to promote low-cost manufacturing and competitiveness of the labour intensive sectors of the economy.
We believe that the immediate reform measures such as reduction in the Corporate Tax rate to the level of 25% for all ignoring the turnover criteria, abolition of MAT , reduction of Income-Tax to 25% with no exemptions and roadmap for disinvestments must come in the announcement of Union Budget for 2019-20, said Mr Talwar
Public investments in infrastructure and affordable housing are crucial to create demand for steel and cement sectors to attract private investments and to spur demand in the economy.
Support to NBFCs should be prioritized as NBFCs are at a critical stage vis-a-vis shortage of liquidity. A strong hand holding of the NBFCs is crucial at this juncture.
Infusion of liquidity in the economy with a significant cut in repo rate by 100 bps in the forthcoming credit policy and a cut in CRR would enhance the liquidity in the economy, spur demand and revitalise growth trajectory, said Mr. Talwar
There is a need to fast-track the infrastructure projects especially building of elevated National Highways to achieve the target of 10,000 kms annually to create employment opportunities not only for the highly skilled workforce but also for unskilled and semi-skilled workforce too, said Mr Rajeev Talwar, President, PHD Chamber.
Koteshwar Prasad Dobhal