MUMBAI, India — In an interaction with industry captains at a Confederation of Indian Industries (CII) event, Indian Finance Minister Nirmala Sitharaman said the government was committed to working towards ensuring policy certainty.
She said the regulators also had a key role in ensuring the same, and the government was working with them as well on this important issue.
Indicating the government’s keenness to facilitate trends and sectors that are the future of the Indian economy, Sitharaman acknowledged that there are seminal changes happening in the financial sector, which the government policy should facilitate.
The economy is moving gradually from a bank-led lending model to a more market-based finance model. Also, once the Development Finance Institution is operational, it will perform the function of long-term lending, which traditionally has been done by banks.
This would increase competition for the banks and also improve their efficiency, according to the minister.
The minister stressed the importance of government and industry working together to ‘create India’s own equity capital.’
Sitharam also emphasized the need to identify how the sunrise sectors and start-ups can contribute to the future of India and how the government could facilitate them.
She said that the government believes in listening, working, and responding and would extend all possible support, according to an official release.
Praising the risk-taking ability of the start-ups, she urged the industry to also come forward and take risks and assured industry captains about addressing issues related to competitiveness, including high power tariffs and the issues related to cumbersome regulatory compliances.
T.V. Somanathan, Finance Secretary and Secretary Expenditure, in his remarks, emphasized that the government trusts wealth creators.
Responding to suggestions from the industry, Somanathan shared that the government is exploring instituting insurance bonds as alternatives to bank guarantees.
On the issue of arbitration awards being typically appealed, Somanathan said that a behavioral change is required. Somanathan further spoke on the increasing pace of vaccination. He said the government had been very aggressive in procurement, even relaxing procurement guidelines. The constraint was on the supply side, which is likely to be addressed soon, as new vaccines become available.
Revenue Secretary Tarun Bajaj said that the Department of Revenue was working on the tax-related issues of start-ups and sought industry inputs on the same.
Earlier, T.V. Narendran, President of the Confederation of Indian Industries (CII), had said that sustained demand is critical for growth to further extend its roots. He said government expenditure will be an “immediate source of demand.”
(With inputs from ANI)
Edited by Amrita Das and Krishna Kakani
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