Bikky Khosla | 22 Dec, 2020
Union Finance Minister Nirmala Sitharaman last week said
that the Centre seeks to create a 'budget as never before'
and help India emerge as the engine for global growth and economic resurgence.
Speaking in an industry event, she added that 'Lives',
'Livelihood' and 'Growth'
are the three key words which have engaged the attention of
policy planners across the world and future policies would need to address the
right engines of growth.
Meanwhile, ahead of the Budget, exporters have raised a
number of demands. The COVID-19 pandemic has created significant stress on the
sector and considering this it now wants enough budget allocation to the Department
of Commerce to support the sector. The exports sector has long been struggling
and its contribution to GDP has declined in last few years. So, now is the
right time to strain every nerve to push the sector's
growth if we want India's GDP to
grow at 8 percent or beyond.
Lack of adequate credit is another lingering challenge
facing the sector. The Covid-19 pandemic has aggravated the banking crisis,
with the sector's NPAs piling up to Rs 9.4
lakh crore as of June 2019, according to reports. In this situation, small and
medium exporters are bearing the brunt of the crisis, and according to a
leading exporters' body, as a relief
measure the Government may now roll out the NIRVIK Scheme which was announced
in September 2019 but has remained un-operational so far.
In terms of income tax, exporters are of the view that tax
deduction not only on R&D but also on product development may be given
under Section 35(2AB) of Income Tax Act. Also, corporate tax reduction can be
extended to non-corporate MSMEs which are subject to higher taxation of 35
percent. Additionally, exporters demand introduction of a 'Double
Tax Deduction Scheme for Internationalization'
and also a dispute resolution scheme to resolve all disputes relating to
Customs and DGFT.
I invite your opinions.