Further simplification of GST, implementation of direct tax code, initiating job-oriented growth measures and maintaining fiscal prudence were some of the key suggestions made by economists for the ensuing Budget to Finance Minister Nirmala Sitharaman on Friday. The finance minister is holding customary meetings with different stakeholders, including industry and farmers' bodies. This was the sixth such pre-Budget consultancy meeting.
The economists were of the view that the Budget, to be presented in the Lok Sabha on July 5, should set the tone for the next five years and is a unique opportunity to promote manufacturing through 'Make in India'. They touched upon a host of macroeconomic factors like economic growth, jobs, fiscal management, investments and public sector borrowings, according to a release by the finance ministry.
Among other major suggestions were removing bottlenecks in supply-chain, framing EXIM policy for agriculture, doing away with specific duties on textiles, reviving inter-state councils for holistic domestic growth, skilling youths, giving fillip to services and manufacturing sector, and bringing structural reforms for a long-term growth.
Stability of tax rates, reduction in tariffs, further simplification of GST, implementation of direct tax code, promoting labour intensive sectors, constitution of independent fiscal policy committee and incentivising digital transactions were also made part of the discussions.
"I have basically talked about the external threats and opportunities because most people focus on fiscal monetary. So, I said (it) is a once in a generation opportunity of moving supply chain to India," said former CEA Arvind Virmani after the meeting.
Manoj Panda, Director, Institute of Economic Growth, stressed that the agriculture sector must be liberalised and farmers should be taught learn how to face markets.
The participating economists also underlined the need for bringing Insolvency and Bankruptcy Code type framework for NBFC sector, infusing capital in banks and tapping into e-commerce's potential for job growth.
Rathin Roy (CEO and Director, NIPFP), S Mahendra Dev (Vice Chancellor, Indira Gandhi Institute of Development Research), Shekhar Shah (DG, National Council of Applied Economic Research), T N Ninan (Chairman, Business Standard), Sunil Jain, (Managing Editor, Financial Express), and Surjit S Bhalla (MD, O(X) US Investment) also put forth their views during the meeting which among others was also attended by top officials of the ministry.
Other prominent economists in the meeting were Rakesh Mohan, Nitin Desai, and Soumya Kanti Ghosh (Chief Economist, SBI).