The government is considering ways to exempt a certain class of foreign portfolio investors from the surcharge on taxable income announced in the budget, while industry leaders have pitched for an over Rs 1-lakh-crore stimulus package to kick-start the investment cycle and revive the economy.

Finance minister Nirmala Sitharaman is slated to meet market players, including representatives of FPIs, on Friday as part of a review of the economy and come out with sector-specific measures to boost growth.

Officials said various suggestions and submissions, including tweaking the surcharge, have been made.

The Prime Minister’s Office has also stepped in to salvage the situation as the selling spree by foreign portfolio investments (FPI) has hammered the market since the announcement of the surcharge in the budget. Officials said a clarificatory note could be issued which would exempt certain types of trusts from the provisions of the surcharge.

The estimated revenue loss because of the exemption would be about Rs 400 crore, they said.

Some of the FPIs have pointed out that they would rather sell their exposure to the country than change the structure from trust to company.

Assurance on stimulus

Industry leaders who met the finance minister said they have been assured that the government would soon take steps to boost economic growth.

“The economy requires a critical intervention by introducing a stimulus package. We have suggested a package of over Rs 1 lakh crore,” Assocham president B.K. Goenka said.

“Though there has been a rationalisation in goods falling under 28 per cent GST, there are still 33 items which remain in the highest slab. We recommend that cement, consumer durables, automobiles and their parts be taxed at 18 per cent,” he said.

JSW Group chairman Sajjan Jindal said: “It was decided that the government is going to take action very soon to revive the industry and it is a matter of sentiments. We got positive feedback from the finance minister.”