Finance Minister Arun Jaitley, who heard the industry in his customary pre-budget meeting, asked them to step up investment.
They suggested that the income tax exemption limit be raised to Rs 5 lakh and interest rate be reduced to give a boost to the manufacturing sector.
The industry said that lower corporate tax and withdrawal of tax incentive would result in higher collections and also make India an attractive investment destination.
The other suggestions include elimination of Minimum Alternate Tax (MAT) and increase in public investment in infrastructure and social sectors.
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Finance Ministry in a statement said that the industry demanded that after demonetisation, since banks will have lot of funds, therefore, interest rate should be reduced for manufacturing and other sectors especially for micro, small and medium enterprises.
These issues among others were raised during the pre- Budget meeting between Finance Minister Arun Jaitley, industry chambers and exporters.
"Jaitley asked the representatives of Business and Trade Sector to increase the private sector spending especially in infrastructure sector," the ministry statement said.
The Government has taken many steps to improve governance by bringing in transparency and efficiency through systematic changes, Jaitley added.
Exporters body FIEO President S C Ralhan suggested creation of export development fund to boost shipments.
CII said that while the demonetisation is right and welcome move for the long term, "it is widely felt among industry members that we need to offset the immediate downturn that industry will go through".
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