Ludhiana, June 13
A delegation of FIEO met the Finance Minister in Delhi recently to discuss several issues, which if agreed to, would boost export. The delegation raised many points on the occasion as the Central Budget is expected to be announced in the first week of July.
Considering the need of a new technology for the economy, all FDIs relating to technology transfer in niche technology should be given approval online within a period of 30 days, said the FIEO delegation. Instead of merging a few small units into large ones, one could explore the possibility of value chain production wherein some of the units make parts and components, some make the final product and some make accessories for the same product. Such manufacturing should be preferred in a close geographical area so that the supply chain is integrated with minimal logistics cost.
The delegation said the MICE (meeting, incentives, conference and exhibition) business was shifting from India to Sri Lanka, Singapore and Thailand due to high GST rate of 28 per cent as such facilities were generally in large hotels having a room tariff of over Rs 7,500 per day. The GST rates may be lowered to 18 per cent.
Tariff reduction would also take away some sheen out of the strategy through which we allure our tariff partner to provide us more market access. This also hits at FDI inflows as with reduced tariff companies may not be eager to set their base in India and continue to supply the products from overseas manufacturing facility taking advantage of low or moderate duty. — TNS
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