Apex industry body, PHD Chamber of Commerce and Industry submits 17 recommendations including a substantial stimulus to create effective strides for a futuristic growth trajectory for Indian Economy and for diminishing the daunting impact of the second wave of the pandemic covid-19.
The PHD Chamber has given its list of recommendation to the Honorable Finance Minister, Smt Nirmala Sitharaman on how to mitigate the impact of the Coronavirus and the subsequent lockdown imposed by several state governments to reduce the spread of the virus.
The re-emergence of pandemic situation with partial lockdowns and curfews in many parts of the country has created incipient signs of economic slowdown in the coming months, said Sanjay Aggarwal, President, PHD Chamber of Commerce and Industry
The PHD Chamber has asked for unhindered operations of all business and industrial operations across the value chain as any disruption in the value chain could cause severe economic hardships including reverse migration of labour back to their remote home locations.
The industry body has recommended a substantial stimulus package to support the economy, trade, and industry in this extremely difficult time.
The PHD Chamber in its recommendations has suggested financial and structural support to Micro, Small & medium Enterprises (MSMEs) in the second wave of the pandemic in terms of extending the moratorium period and offering concessional rates of interest on borrowings.
Sanjay Aggarwal has suggested for extension of ECGLS scheme to 31st March 2022 with an increase in the amount from Rs. 3 lakh crore to Rs. 6 lakh Crore along with increase in limit of ECLGS credit from 20 to 40 percent of the total of fund and non-fund limit availed by the company as of 29th February 2020 for all the sectors.
He explained that the increase in limit from 20 to 40 percent should be extended to all sectors and not only a few sectors such as Hospitality, Travel & Tourism, Leisure & Sporting, and Healthcare for which the government has announced recently.
Sanjay Aggarwal stated that the government needs to defer the show cause notices being issued by the income tax department. He said that the no show-cause notices/income tax notices in respect of assessment may be issued until after the situation improves, as the taxpayer is not in a position to reply to such show-cause notices due to total paralysis of office work and also because the offices of the tax consultants are also closed.
The industry body is of the opinion that there should be a reduction in the TDS Rate for FY 2021-22 to the tune of 50 percent. This would provide some liquidity to the taxpayer who has been reeling under acute liquidity situation as the impact of the pandemic is more acute and severe this time, said Sanjay Aggarwal
According to Sanjay Aggarwal, there is a need for the extension of calculating drawing power for working capital calculation of 210 days for further 6 months to MSMEs and financially stressed sectors like Textiles.
The PHD Chamber has suggested a need to safeguard MSMEs and the iron & steel industry from skyrocketing steel prices.
The industry body urges the Government of India to ban exports of steel to China and also requests imposition of 35 percent export duty on steel. At the same time, there is also a need to levy uniform duty on all forms of iron ore exports including pellets.
The industry body has recommended a reduction in GST to boost Ayush industries and the removal of capping of exports of all Ayush products.
The PHD Chamber suggests that the cash deposit limit may be enhanced to Rs. 10 lakhs. Presently, there are charges on cash deposits in banks beyond the limit of Rs 2 lakhs. This will provide much-needed relief to the struggling population and provide some relief amidst the crisis.
The Chamber has recommended the launch of the Affordable Hospital Scheme in every district of the country with private participation. The industry body has requested state governments to allot land free of cost and the financial institutions/banks to offer long term loans at subsidized rates of interest to the private sector to set up the these hospitals/medical facilities.
Sanjay Aggarwal has said that the moratorium on insolvency under IBC should be extended till at least December 2021.
Sanjay Aggarwal said that the hardship was created for NRIs during the months of April, May and June 2020 when there were no flights available whatsoever from India to abroad and vice versa meant that people as well as NRIs were stranded wherever they happened to be in the end of March, 2020. NRIs were not able to fulfil the compliance of 120 days because of severe disruption in the international flights.
In light of this, he suggests that the people those who were in the category of NRIs in 2019-20, should also be considered NRIs for the subsequent two years i.e. FY 2020-21 and FY 2021-22 as these two years are pandemic covid-19 impacted years with drastic disruption in international flights.
The PHD chamber also recommends that the Non-obstante clause in the Companies Act, 2013 needs to exclude the independent directors from criminal liability for offenses committed by the company.
Sanjay Aggarwal stated that it is being noticed that the non-disbursement of the MEIS/RoDTEP benefits are hindering the exports as well as exporters are struggling to keep their companies afloat. In this regards, PHD Chamber has recommended a need to disburse the pending scrips under various export incentive schemes.