Ahead of the Union Budget on February 1, CII Eastern Region today hoped that the government would increase its capital expenditure substantially and overhaul tax structure to cope with the emerging situation.
"The government's capital expenditure should increase substantially. This will lead to crowding-in of private investment," Confederation of Indian Industry (CII) Eastern Region Chairman T V Narendran said in his budget expectations.
"Substantial investment in public infrastructure will not only give a boost to growth but will also serve as an enabling agent for private investment in other sectors," he explained.
Stating that overhauling the tax structure is another area that merits attention, Narendran said investors across the globe would show greater interests in India if the country "makes departure from a high tax, high incentive regime to a single corporate tax rate of 18 per cent including all surcharges and cess, removing all incentives and concessions at the same time."
About steel industry, Narendran suggested reduction in customs duty from 2.5% to nil on coking coal, from 5% to 2.5% on metallurgical coke and a cut in customs duty from 5% to NIL on LNG when imported by gas based steel plants or for supply to such plants.
According to Narendran, the government needs to devote considerable attention to job creation.
He also underscored the need for technological innovation, something which would not only catalyse growth but would also increase manufacturing productivity and jobs.
At a time when the Make in India has captured investors' imagination worldwide, the country would be expected to script a innovation-led growth story, he said.
Narendran also spoke in favour of greater volume of public investment in research in the higher education from the present 0.04 per cent of GDP to a global average of 0.4 per cent and removal of the distinction between plan and non-plan expenditure in the 2017-18 budget.
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