NEW INDIAN GOVERNMENT: AGENDA AHEAD

The free and fair poll in world’s largest democracy is over and the new Government is in the
process of taking shape. The current economic outlook provides a great challenge to the policy makers. The entire nation and more particularly professionals including Chartered Accountants have to play a major role in shaping India's growth story. The Government needs to address following areas:
Recovery from Economic Slow Down: sentiments are getting better and a major economic push is needed to move towards rapid growth. The Government may consider the following -

• To ensure that bank credit is available easily with lower interest rate. The interest rates require a 3 to 4 per cent reduction immediately.
• The insistence on collateral by banks and their lackluster attitude to fund real estate, infrastructure, power projects and grass root expansions need policy support in shape of credit enhancement.
• Immediately initiate massive PPP projects in the area of power projects, ports, roads, interlinking of rivers and watershed development.
• Agriculture sector needs special technological input for better produce and empowerment to be able to afford cold chain facility and warehousing of products. Movement of agro goods across nation to be tax free and without any approval / licenses. Tax burden on agriculture including Mandi Tax and other levies to be withdrawn immediately.
• To strengthen banks and financial institutional framework for longer channelization of funds at all levels - fiscal policy support for resource raising and deployment
• Tax burden on Indian economy is mounting. The Government may consider reducing its size significantly. Indirect taxes including VAT, Service Tax and other taxes need substantial reduction. Direct tax may need to go down by 5 to 10 per cent.
• Corporate debt restructuring need active support and approach of recovery by asset reconstruction companies need to give way to revival approach by supporting management and giving professional and financial input.
• Government debt restructuring should be a major agenda. International and domestic debt should be pre-paid with an embargo on fresh borrowing. This is the right opportunity as deficit funding does not pose a major inflationary threat.

Governance: Transparency in governance is a must and major social steps are needed for a war against corruption and inefficiency. The Government / PSU jobs need not have the current protection to enable a lean and effective set up to be put in place.

Human Resource Welfare: The working human resource need a fresh dose of justice. The hand worker deserves better salary levels. The current labour laws are to be completely revamped to eradicate unnecessary requirements which may be irrelevant now. Social security to everyone through contributions is to be introduced for unorganized sector also. Long hours working being practiced by multinational companies in India has to be eradicated by effective laws. This exploitation is adversely impacting social fabric. Special treatment is required for BPO and night shift working community.