 "PM, India Inc discuss sovereign bond")
At a meeting of the Prime Minister’s Council on Trade and Industry, business leaders raised the issue of tax disputes, saying these affected the morale. The government is yet to sort a tax dispute with Nokia relating to payments to the parent company for software, and a row with Shell on transfer pricing.
Raising duties on luxury and consumer goods figured in Monday’s talks. The government has already raised customs duty on gold from six per cent to eight per cent. Budget 2013-14 had raised customs duty on high-end motor vehicles from 75 per cent to 100 per cent, on motorcycles with engine capacity of at least 800cc from 60 per cent to 75 per cent and on yachts and similar vessels from 10 per cent to 25 per cent.
An official statement listed a sovereign bond and reciprocal swap lines as a point of discussion between the prime minister and industry leaders. Naina Lal Kidwai said suggestions were made on a sovereign and NRI bond issue. Bringing the offshore rupee market on-shore was also discussed.
Representatives of India Inc — Reliance Industries Chairman Mukesh Ambani, Infosys Executive Chairman N R Narayana Murthy, Wipro Chairman Azim Premji, Housing Development Finance Corporation Chairman Deepak Parekh, ICICI Bank Managing Director and Chief Executive Chanda Kochhar, Bharti Enterprises Chairman Sunil Mittal, Bajaj Group Chairman Rahul Bajaj, Infosys Executive Vice-Chairman S Gopalakrishnan, HSBC India head Naina Lal Kidwai and YES Bank Managing Director and Chief Executive Rana Kapoor — wanted the prime minister to devise innovative ways to reduce gold imports to narrow CAD.
This year, uncertainty over capital flows is high, as India didn’t resort to drawing upon its forex reserves to finance the CAD in 2012-13, except in the second quarter, when a marginal $0.2 billion was withdrawn from the reserves.
An official who attended the meeting said India Inc termed CAD the economy’s primary concern. To narrow CAD, the prime minister wanted the industry to cut imports of oil, coal and gold.
Industry leaders, on their part, wanted the prime minister to raise software exports by raising the issue of visa restrictions with the US. Software exports, a part of invisibles, help offset trade deficit.
The business community asked the prime minister to devise a mechanism to provide moratoriums on loans to delayed projects.
TALK THERAPY
Prime Minister’s trade and industry council meetings
MAY 26, 2010
GUEST LIST: Ratan Tata, Ashok Ganguly, Keshub Mahindra, Mukesh Ambani, RP Goenka, Aziz Premji, Sunil Mittal, Swati Piramal, Deepak Parekh, Jamshed Godrej, Kiran Mazumdhar Shaw, Chanda Kochhar and Sunil Kant Munjal
AGENDA: India's industrial growth and achievements. The members also held wide-ranging discussions on various issues, including use of clean technology for energy and economic security, research and development to further industrial growth, contribution of industries in food security and affirmative action for social inclusion
OUTCOME: PM urged India Inc on the need for industry to reach out to the rural economy and contribute towards skill development
DECEMBER 22, 2011
GUEST LIST: Ratan Tata, N R Narayana Murthy, Mukesh Ambani, Rahul Bajaj, Ashok Ganguly, Sunil Mittal, Swati Piramal, Anu Aga, Deepak Parekh, Jamshed Godrej, M S Banga, Chanda Kochhar and Sunil Kant Munjal
AGENDA: The business leaders expressed their confidence in the fundamental strength of the Indian economy. They were generally of the view that the economy was poised to return to a high rate of growth in the near future. Many of them informed the Council of plans to invest in new projects in India, and stressed the need to expedite ongoing infrastructure and other mega projects
OUTCOME: PM promised assistance from the Ministry of Environment and Forests in removing bottlenecks in implementing large projects
MARCH 31, 2011
GUEST LIST: Ratan Tata, N R Narayana Murthy, Mukesh Ambani, Rahul Bajaj, Ashok Ganguly, Sunil Mittal, Swati Piramal, Anu Aga, Deepak Parekh, Jamshed Godrej, M S Banga, Chanda Kochhar and Sunil Kant Munjal
AGENDA: Financial sector reforms, Euro zone crisis and the rupee depreciation
OUTCOME: PM highlighted the need to urgently implement the Goods and Services Tax. He also underscored the need for a comprehensive manufacturing policy, which was launched in September
JULY 29, 2013
GUEST LIST: N R Narayana Murthy, Adi Godrej, Chanda Kochhar, Sunil Bharti Mittal, Deepak Parekh, Rahul Bajaj, S Gopalakrishnan, Naina Lal Kidwai and M S Banga
AGENDA: The worsening current account deficit, depreciation of the rupee and decline in investments