India's Finance minister Nirmala Sitharaman said the government is open to further reforms for making India a more attractive investment destination, eyeing investment from global players. The government has taken multiple steps, including reduction in corporate tax, she said at the India-Sweden Business Summit.
Without sharing details of future reforms, the finance minister said, “I only can invite and assure that the government of India is committed for further reforms in various sectors whether it is banking, mining or insurance and so on.” She further said that the government is addressing challenges faced by the industry not just Indian-owned but operationalise industries which are present in India. “Since after budget I have made sure constant interactions with the industry, understanding their challenges, and therefore, since after the budget not waiting for another budget which is expected in February 2020, we took major structural reform in the form reduction in corporate tax. This one measure indicates how our government believes in reforms. Today I say there are many more steps we have to take,” she added.
In the biggest tax reduction in 28 years, the government in September slashed corporate tax rates up to 10 percentage points as it looked to pull the economy out of a six-year low growth with a £14.5 billion tax break. Base corporate tax for existing companies has been reduced to 22% from 30%, and to 15% from 25% for new manufacturing firms incorporated after October 1, 2019, and starting operations before March 31, 2023. “Our step of corporate tax reduction shows how much our government believes in reforms and there are many more steps that we have to take,” she said.
She invited Swedish firms to invest in infrastructure development projects. India plans to invest about £1,000 billion in the infrastructure sector in the next five years. The government has formed a task force which will come out with a list 10 major infrastructure projects by December 15, she said. The finance ministry in September set up a task force headed by economic affairs secretary to prepare a road map for the “national infrastructure pipeline” from 2019-20 to 2024-25 under a £1,000 billion infra plan. The task force is expected to cover greenfield and brownfield projects costing above £10 million each.
“From the point of view being a democracy, a rule-based country, there is a clear rule of law principle which governs this country in a very transparent way and therefore if global investors are looking for an environment which is familiar to them is far more acceptable to them, India stands out,” she said.
