Industry association CII has suggested a graded road map towards competitive import tariffs over three years, with the lowest or nil slab between zero and 2.5 per cent for raw materials, highest of 5-7.5 per cent for finished goods and 2.5-5 per cent for intermediates, as part of its pre-budget recommendations to the government.
The Confederation of Indian Industry (CII) has proposed the road map to encourage domestic manufacturing in alignment with global trade trends that would boost India’s export competitiveness according to the shifting global value chains in the next three to five years.
“This will help Indian industry integrate into the global value chain while becoming competitive with its goods and services in the world markets,” the industry body said.
Boost employment
Making a case for the need to boost to employment at higher levels, the CII suggested raising the cap on emoluments to Rs 50,000 per month to encourage employment in higher skilled jobs.
Section 80JJAA provides for the deduction of 30 per cent on emoluments paid to new employees, which can be claimed for three years. This is available up to Rs 25,000 per month.
Besides, over the last few years, it is seen that to enhance the financial strength of banks and for the stability of the financial sector, the RBI has mandated that banks should augment their non-performing asset (NPA) provisioning.
Bad loan provision limit
The CII has suggested that the limit prescribed under section 36(1)(viia)(a) for provision for bad and doubtful debts for Indian banks should be increased from the existing limit of 8.5 per cent to 15 per cent.
Banks operating in India facilitate foreign investment by foreign portfolio investments (FPIs) by acting as custodians (cash and securities) for the FPIs investing in India.
The industry body said specific clarification should be provided so that banking and broking service providers are not held as representative assessees of their clients. Moreover, the RBI has lowered the limit for recognising an account as NPA from six months to 90 days.