Immediate priority of Govt. is to keep investment cycle going: Chidambaram

New Delhi - Union Finance Minister P. Chidambaram has said that immediate priority of the Government is to keep the investment cycle going.

"There are some positive signs in the economy but no discernible trend so far,"
Chidambaram said during his pre-Budget consultations with industry and trade here yesterday.

He said that both domestic and foreign investments are not an option but an economic imperative for the government.

He said that the Cabinet Committee of Investment is constituted to resolve inter ministerial issues and to speed-up the clearances of projects.

Along with the Finance Minister, both the Minister of State for Finance S.S. Palanimanickam and Namo Narain Meena, Adviser to the Finance Minister, Parthasarthy Shome, Finance Secretary, R.S. Gujral, Secretary, Financial Services, D.K. Mittal, Revenue Secretary, Sumit Bose, Secretary, Department of Economic Affairs, Shri Arvind Mayaram, Secretary, Disinvestment Ravi Mathur, Secretary DIPP, Saurabh Chandra, Secretary, Department of Commerce, S.R. Rao, Chief Economic Adviser, Dr. Raghuram R. Rajan, Dr. Anup K. Pujari, DGFT and Chairman CBEC were present among others.

About 16 representatives representing different Organisations participated in the aforesaid meeting.

Various suggestions were made by the representatives of trade and industry including present rates of excise and service tax rates be maintained if not reduced, government may allow 2 percent interest rate subvention for all sector of exports, allow 25 percent accelerated depreciation for investment in plant and machinery for pre-defined period of 3-5 years to prepone investments without affecting revenues, 250 percent weighted tax deduction on expenditure incurred by companies on going green, unutilised assets of Public Sector Enterprises be monetized and revenues generated be used for investment in infrastructure.

Other suggestions include acceptance of the recommendations of the Kelkar Committee Report, disinvestment process be started from the beginning of financial year rather than in the end, deregulation of diesel, early implementation of GST, no tax on transactions in commodity exchanges and non introduction of inheritance tax etc.

Other suggestions include efforts to unlock money struck in tax litigation, tax benefits to MSME sector, waiving of excise duty etc. on 14 inch colour TVs and various Export Oriented Units among others.

It was suggested that nothing in budget should dampen the spirit of investors or create a negative perception.