Scrap retrospective taxation, says HCC's Ajit Gulabchand

Praising the pro-industry economic policies of the NDA government, infrastructure major HCC's chairman Ajit Gulabchand today said all retrospective taxes should be scrapped to send a positive signal to the world.
"... First is all the arbitration awards, please pay them and if you want to challenge them, challenge afterwards. Second thing I would like to see is remove the wretched retrospective act.
"It gives the single most beautiful signal to the world that we really mean business in a new way, we are making a break from the past," he said.
Gulabchand added that the Reserve Bank should cut interest rates "down at least by three to four per cent".

The efforts made by the Narendra Modi-led government to tackle fundamentals will give the stability needed to grow the economy, he added.
"An excellent change of direction has been made both for the neighborhood as well as internationally and foreign policy nowadays, inexplicably also means a lot more connections for trade and we must not forget that about a year or year-and-half ago the world was not even bothered to look at India, it had given up on India...," he told a TV channel.

Getting more people into banking system, not necessarily giving them free incentives, but getting them into the system, is one of the defining features of the current government, Gulabchand pointed out.

"Then more power to the states, after all we are a union, we are a federal set up. Too much was Delhi centric and these things have been achieved very well in a short time," he added.
Gulabchand said one of the most important economic reform that the government has done is that it has done away with the Planning Commission.
"Now the Planning Commission essentially is a Marxist socialist pillar. It basically was created by them so the state will control the resources of the nation whether it is even where Latha will work or Ajit will work down to where Steel will be used and by doing away with that he has given a signal we are now becoming a free economy," he added.

By pushing through the Goods and Services Tax (GST), the government has tried to create a common market, he said.
"So you can look at it. On one side they are doing away with the Planning Commission there is more strength to the states and the GST we have acquired a huge foundation for India's economic growth," Gulabchand added.
On the government's efforts in the infrastructure sector, he said the slowdown was "so serious" that about 4-5 years ago the order book in global terms per year at beginning of the fiscal was about USD 110-120 for construction. It has dropped to below 15.

"Now to come back to 50 and 60 is a journey. This journey we anticipated would take them (government) at least about 18 months. Now looking at the damage done by the old policies, they should probably take not just 18 but another year or so," he added.