Washington: India offers a predictable, stable and business-like environment which is one of the major factors for foreign companies to invest in the country, a top Indian industrialist has said as he underscored the need for labour reforms.
Alok B Shriram, CEO of manufacturing company DCM Shriram Industries, who is in the US as part of the Federation of Indian Chambers of Commerce and Industry (FICCI) business delegation, said he sensed great deal of enthusiasm about India and the investment climate in the country in his interactions with his American counterparts.
“On the whole, everyone is looking forward to working on investing in India. That difference coming in now, (is) not just transferring technology or something, but it’s actually investing,” Shriram told PTI Tuesday.
He observed that the first reason for it is that India has a very young and very well-trained workforce that, at least, is well educated.
“It’s a good environment. I think in the last decade, this government has proved very clearly that they lay out a path and then they walk the talk. Some things may be a little slow or fast but they walk the talk, and they follow that path,” Shriram said.
“So, you have to look at it in light of business. Businesses like stability and predictability. I think this is what they’re getting. We may like or dislike some policy, that’s a different matter, but at least the government is giving you a predictable path forward. That is a big reason to invest in India.
“Of course, it’s also a corollary that China is having its own set of problems, and we should take all the benefits out of that,” Shriram said.
He favoured the implementation of new labour codes and suggested that micro, small and medium enterprises be given similar facilities that are given to startups.
“The central government has done what it could. It’s now for States to take the steps to actually bring out the rules and each State has to adopt them because it’s a concurrent subject,” he said.
Shriram said the government needs to promote Micro, Small and Medium Enterprises (MSMEs) because MSMEs per unit of capital can create the maximum number of jobs.
“I think they should remove investment as a criterion for MSME and keep it on turnover as is done in a lot of European countries like Germany,” he said.
“The second encouragement which I would suggest is that, like startups are given a concessional tax, any MSME who gets registered and gets into the formal area of the government data banks etc. If they registered, they should also be given the same break as the startups which is essentially 15 per cent tax, and they get a three-year tax holiday in a span of 10 years,” he said.
He said the move will encourage many people to come in and formalise their industry.
“Today, many people find it in the MSME sector not worth their while to come into this formalised area,” he said.
PTI
