| May 16
Industry hails structural reforms, but says liquidity boost needed
In big-bang reform measures, Centre has decided to raise the limit for FDI for defence manufacturing from 49 to 74% under the automatic route and has also allowed commercial mining of coal, whereby any party can bid for coal block and sell it in the open market,As Finance Minister Nirmala Sitharaman on Saturday announced a slew of reform measures for defence and coal mining among others, industry participants have come out applauding the government for the reform decisions, but many have also suggested that liquidity support is the need of the hour. In a big-bang reform measure, the Centre decided to raise the limit for foreign direct investment (FDI) for defence manufacturing from 49 to 74 per cent under the automatic route. Further, the government has also allowed commercial mining of coal, whereby any party can bid for coal block and sell it in the open market.
Chandrajit Banerjee, Director General, Confederation of Indian Industry (CII) said said the announcements give shape to the Prime Minister`s vision of `Atmanirbhar Bharat` for localised manufacturing, reducing imports and boosting employment.We believe the policies announced today would incentivise India`s global engagement with more fund inflows and higher competitiveness of domestic industry," he said.
Assocham Secretary General Deepak Sood said: "Major policy decisions across the most critical and strategic sectors like defence production, space, atomic energy, civil aviation and commercial coal mining unveiled by Finance Minister Nirmala Sitharaman today demonstrate the government`s resolve to stay on course of bold economic reforms, undaunted by the Covid-19 global health crisis. Financial advisory firm FINDOC Group`s Executive Director Nitin Shahi said that industry needs rationalisation of indirect taxes and customs duties.
When we talk of structural reforms, these need to be deliverable on the ground. Industry needs rationalisation of indirect taxes, customs duties for a morale boosting capsule," he said.