Money Has To Go To Social Sector, As Income And Economy Will Rise: Anil Khaitan, Chairman Of SNK Corp
On 19th January, BW Businessworld along with NewsX held a Pre-Budget 2018 Round Table, with many prominent names from the corporate world and academia participating. In a session called ‘Corporate Promoters’, moderated by Gauri Dwivedi from NewsX, various stalwarts from the industry participated in discussing their views before the budget was released.
“We will explore what the corporates will look out for to push the economy towards higher growth rate. As far as rural economy and agriculture are concerned, there is a consensus that there is rural distress. It’s an election year, so populism will come in”, said Dwivedi.
Anil Khaitan, Chairman of SNK Corp, said, “The Finance Minister is going to look at the MSME sector in this budget, which has mostly been neglected even though it’s the second largest employer in the country. He will focus on agriculture too, as agriculture has to gear up, as 60% of the population cannot just contribute to 14% of the GDP. Thirdly, taxes will be another place which has to be looked at. We want corporate tax rates to come down, and we see the sense of it, especially when you compare it to the USA. If you see, nationally the tax rates are down, there should be something done for corporates too”. He also added, “Money has to go towards the social sector as well. As because when income rises, the economy rises due to a snowball effect. There has to be an increase in consumerism as well, for investments to increase”.
“Some people say money going to healthcare is money going down the drain. What do companies in healthcare need?”, asked Dwivedi. “A good thing is that there is an increase divestment, and money has to go towards infrastructure, sanitation, water, and healthcare. India still has a large population of young people but the longevity of people has increased. If you invest in healthcare, it’s beneficial because it will lead to more productivity and a healthier economy. Healthcare should not be looked upon as soft targets. Just because doctors and healthcare have become soft targets, they get bashed everywhere“, said Mahipal S Sachdev. Chairman & Managing Director, Centre of Sight. He also added, “The steps taken for Make-In-India when it comes to medical devices has kind of been counter-productive as foreign companies are not finding enough reason to invest. We need MSME clusters and industrial estates. The government can be populist and also be growth-centric by concentrating on MSME, infrastructure, and agriculture.”
Sanjiv Bajaj, Managing Director, Bajaj Capital, said, “This is going to be big budget, we are expecting it, and we are also expecting a balanced budget, so there will be elements of populism. It has to be sustainable. Angel investing is becoming a big thing with the start-up India campaign. There has to be a lot done for infrastructure. Even though there are populist moves, there is a lot of power in them. The government should not just resort to populist measures, but it has to make the industry happy too. There is availability of capital, but you have to make it attractive to invest in India. This Make-In-India initiative has to happen.”. “Corporates are looking at infrastructure improvement, especially in urban development. Investment in infrastructure is going to be super important. There has to be reduction of cost of capital so Indian companies can compete globally. It will improve business sentiment and lead to job creations. I expect the budget to be for corporates, but also populist. It’s going to be an important budget. On corporate tax rates have to be globally competitive.
Siddharth Kothari, Promoter, Om Metals Infraprojects Ltd, said, “The government should enable more people to buy homes, there should be tax-breaks for home loans, and that will be towards government’s housing for all agenda. Corporate tax-rate should also be reduced, so foreign companies find India a viable investment destination. We have a higher tax-rate than our neighbouring countries”.
“We have been one of the biggest exporters of our industry. There should be more focus on our industry, which is export of solar, electronics and so on. The corporate tax structure is very flat, it should become more graded. You can structure the tax structure of corporates so people make more profits. The tax structure tinkering can be very much possible, as a person who earns 10 lakhs pays 30%, and even the person who makes 10 crores has to pay 30%, which is unfair“, said Kunwer Sachdev, Managing Director, Su-Kam.
Anil Khaitan, Chairman of SNK Corp, said, “The Finance Minister is going to look at the MSME sector in this budget, which has mostly been neglected even though it’s the second largest employer in the country. He will focus on agriculture too, as agriculture has to gear up, as 60% of the population cannot just contribute to 14% of the GDP. Thirdly, taxes will be another place which has to be looked at. We want corporate tax rates to come down, and we see the sense of it, especially when you compare it to the USA. If you see, nationally the tax rates are down, there should be something done for corporates too. Money has to go towards the social sector as well. As because when income rises, the economy rises due to a snowball effect. There has to be an increase in consumerism as well, for investments to increase”.
