Fewer rate slabs under the goods and services tax (GST) regime, progressive reduction of government stake in public sector enterprises (PSE), and a ranking of states on the ease of doing agriculture should be on the mind of political parties while releasing their election manifestos, the Confederation of Indian Industry (CII) has said.
Coming out with its own ‘Suggested Election Manifesto’ on Sunday, CII has said economic issues should receive priority from parties. The document targets an average growth rate of 8 per cent per annum for the next five years and has been shared with all major political parties, both national and regional, for their consideration and inclusion in their party manifesto, according to CII. “It envisages a continued high pace of reforms, enabling India to take a lead in a world of multiple transformations in the global and technology environment,” Chandrajit Banerjee, director general of CII, said. CII has reiterated its demand for a simpler GST regime with fewer rate slabs, as compared to the current five. It has called for compressing all existing rates into two or three slabs. Currently, the Centre is mulling a reduction in the number of slabs under the GST by doing away with the 12 per cent tax rate. The industry body has also announced its hope of corporate income tax being reduced to 18 per cent with no exemptions.
It also advocated that the government progressively exit from strategic public sector enterprises. “Government stake should be lowered progressively to 51 per cent in phase 1, 26 per cent in phase 2 and nil in phase 3,” it said. CII has also called for complete government exit from other PSEs within 5 years.
For the agriculture sector, a comprehensive national agriculture mission in partnership with state governments has been suggested.
Also, it has pushed for a ranking of states on the ease of doing agriculture, initially a suggestion by the farm ministry. It is important to promote efficient marketing in electronic National Agriculture Markets to ensure better farmer income, noted the CII statement.
It added that industrial corridors and sector-specific industrial parks need to be promoted through public-private partnership. Micro, small and medium enterprises should be allocated 25 per cent land in industrial corridors at lenient rates.
To generate new livelihoods, CII has called for an empowered committee of central and state labour ministers to rework labour laws. Labour-intensive manufacturing and services sectors like food processing, textiles and apparel, tourism, healthcare, etc. need special attention, it said.
“The Manifesto highlights administrative, judicial and police reforms. We also recommend the highest priority on education, healthcare and infrastructure, among other sectors,” added Banerjee.
The industry body's note advocates raising public expenditure on education to 6 per cent of the Gross Domestic Product. Last year, the NITI Aayog had also argued that spending should go up to at least this level by 2022. CII has also suggested that vocational training should be made part of the regular curriculum at schools and the government should incentivize better performance of teachers with upgraded digital school infrastructure, especially in rural areas.
It has also pointed out that universities should be better linked with industry and crucial government funding for research and development should be raised to 1 per cent of GDP. The public expenditure on health should be increased to 3 per cent of GDP to reduce out-of-pocket expenditure while the healthcare sector should be notified as an infrastructure sector, the industry body said.
On skill development, the industry body has recommended lifelong skilling modules and new delivery models based on technology.
Similarly, the public expenditure on health should be increased to 3 per cent of GDP to reduce out-of-pocket expenditure while the healthcare sector should be notified as an infrastructure sector, the industry body said.
On electoral reforms, CII has also called for simultaneous elections at both the central and state levels, something that has been suggested by Prime Minister Narendra Modi over the past few years but has found few takers across party lines.