Ever affirmative, India's Finance Minister Arun Jaitley said India could grow faster if monsoon strikes soon as it would improve agriculture and raise rural income. “Economy, which had been expanding on strength of public investment, highest foreign direct investment (FDI) and urban demand, could grow faster if rural demand was added.”
He said that even though the global economic outlook remains bleak, India remains the fastest growing major economy and has the potential to grow at “an even faster pace”. The statements came during an ongoing debate in parliament, after which, the Finance Bill was passed. It will now be forwarded to the Upper House. Jaitley has also ruled out rollback of 1 per cent excise on non-silver jewellery saying the levy was not applicable on small traders and artisans and only jewellers with more than £1.2 million turnover last year and £600,000 this year will attract the duty.
The FM has introduced amendments to the Finance Bill, 2016, for capital gains clarifying that the long-term capital gain period in case of unlisted securities has been reduced to 24 months from 36 months. Separately, the Central Board of Direct Taxes, in a recent order to field formations, said that income arising from transfer of unlisted shares, irrespective of period of holding, would be taxable under the head capital gain. Talking about black money, Jaitley said the government has brought £7.1 billion of undisclosed assets to the books, but he ruled out bringing agriculture income under the tax net, saying large farm-based income was rare and people using agriculture as front to hide income from other sources would be dealt with by tax authorities.
Talking about the problem of non-performing assets of banks, Jaitley said, “NPA issue with banks is an issue of concern. Some loans may have been given wrongly. I am not going into who is responsible for it. But weakened business cycle due to global economy has also impacted bank balance sheets. Hiding NPA will not resolve the problem. It should be reflected in balance sheet and addressed via capitalisation.”
Jaitley said the government has drafted the amendments to the RBI Act, which will pave the way for creation of monetary policy committee, as was announced in the Budget. The passage of the Finance Bill will allow formation of the six-member monetary policy committee, which will include the RBI Governor and three government nominees.
